Arkansas Decides to Retain Retail Rate Net Metering Through 2022

The Arkansas Public Service Commission on June 1 issued an order retaining the current net metering rate structure, which credits rooftop solar customers at retail rates for net excess generation, through the end of 2022.

The commission decided that systems under 1 megawatt should receive the full 1:1 retail rate credit until Dec. 31, 2022 after which, utilities may seek approval of alternative rate structures. The order grandfathers existing customers under the retail rate compensation for a period of 20 years.

The order also maintains the 1:1 full retail credit for net excess generation from non-residential customers up to 1-megawatt served under a rate with a demand component. For demand-component customers with a generation capacity of 1-20 megawatts, the commission found that there is some evidence of cost-shifting to non-net metering customers, justifying the adoption of a grid charge. A utility may seek approval of a revised grid charge rate by demonstrating that an unreasonable cost shift exists or has already occurred on a cumulative basis, rather than on the basis of an individual customers’ facility.

The order follows a 2019 law that authorized state regulators to take a number of actions including lowering the compensation to the utility’s avoided costs plus any benefits, or imposing a fee on net metering customers, provided they are in the public interest and do not result in unreasonable allocation of costs to other customers. The law also allowed utility customers to enter into contracts with third-parties and for the leasing of solar equipment, expanding access to the resource by lowering installation and maintenance costs.