March 28, 2023

Electrical utilities, photo voltaic corporations strike compromise on contentious cost-shifting invoice

The Home Insurance coverage and Commerce committee spent as a lot time debating a controversial difficulty as Senators did with the governor’s schooling invoice on Wednesday (Feb. 22).

HB1370 by Rep. Lanny Fite, R-Benton, pitted electrical utilities towards the photo voltaic trade in a measure known as the “Price-Shifting Prevention Act of 2023.” Sen. Jonathan Dismang, R-Beebe, is the Senate co-sponsor.

Price-shifting in any trade is the priority that one group of payers is underwriting the prices of a gaggle not paying their fair proportion. On this occasion, electrical utilities declare that companies and people with photo voltaic arrays are being paid for his or her further energy at an quantity too excessive to cowl the utilities’ prices.

At difficulty is the credit score that utility corporations pay to photo voltaic producers for extra energy generated again to {the electrical} grid. Electrical corporations pay a retail price and declare it’s too excessive to recoup prices of storing and transmitting electrical energy. The photo voltaic corporations contend the speed of compensation has been calculated into present initiatives in addition to initiatives underway.

The committee’s morning hour and a subsequent afternoon listening to had been spent with utility executives talking in favor of HB1370 and a mixture of photo voltaic suppliers, municipalities, college district and industrial prospects arguing towards it.

After hours of contentious debate and questioning, Dismang, Fite and leaders of the Arkansas Superior Power Affiliation (AAEA) introduced a compromise. AAEA represents quite a lot of photo voltaic corporations and renewable power corporations and customers throughout the state and has been against HB1370, claiming it will halt new initiatives, disrupt their enterprise fashions, and kill their trade.

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The shock settlement was introduced by Dismang and Fite, with AAEA Chair Heather Nelson acknowledging her group would finish its opposition. The compromise consists of:

  • Grandfathering photo voltaic contracts from Dec. 31, 2023 to Sept. 30, 2024;
  • Increasing the proximity by which the array have to be constructed to the meter from a 5-mile to a 100-mile radius;
  • An array of at the very least 5 megawatts that’s beneath contract as of Wednesday or has a submitting with the Arkansas Public Service Fee could be grandfathered; and
  • A criticism filed with the PSC would additionally set off grandfathering.

The Home Insurance coverage and Commerce Committee could take up the amended measure on Thursday.

Editor’s observe: Jeff Della Rosa and Roby Brock contributed to this report.