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Arkansas Seeks to Expand Its Advanced-Energy Economy

Katie Niebaum

In this interview, Katie Laning Niebaum, executive director of Arkansas Advanced Energy Association, described the challenges and aspirations she encounters as she seeks to build clean energy markets in Arkansas. Although some success stories have taken place in the energy efficiency space, much more work remains to be done.

CEFF: How would you describe the solar-energy market's current successes and challenges in Arkansas?

Niebaum: Innovation and declining costs are helping to drive the deployment of advanced-energy technologies in Arkansas. Solar is an increasingly affordable option for Arkansas residents seeking to generate their own electricity, both at home and for their businesses, including agricultural operations.

2017 was a record year, as the number of net metering systems increased by a dramatic 56 percent over the previous year.

That figure is double the rate of growth over each of the previous three years and the largest year-over-year increase in the actual number of systems ever.

Arkansas Advanced Energy Association (AAEA) members report that consumer awareness regarding solar’s affordable price and short-term payback has grown. As a result, firms have added new positions to meet growing demand while new companies have entered the marketplace in the last few years alone.

Advanced-energy sources including solar power are creating opportunities for businesses to capture savings and hedge against energy price volatility. A growing number of Arkansas corporations have installed solar to reduce utility costs and meet energy commitments.

Arkansas farmers are excited about solar because it can protect against rising energy costs, which are a major expense of their operations. Schools and universities are powering their campuses with solar energy in increasing numbers, too.

Utilities recognize the benefits of solar. Entergy Arkansas recently completed its 80-MW Stuttgart Solar farm. At the “flip the switch” ceremony, Arkansas Governor Asa Hutchinson spoke about the importance of having clean energy sources to recruit industry to the state. He called a clean energy supply a “great talking point in recruiting industry to our state that we will continue to focus on.” 

CEFF: What is your perspective on the energy efficiency market's successes and challenges at this time in Arkansas?

Niebaum: Arkansas is recognized as a leader in the energy efficiency sector, not just in the Southeast but at a national level, due to the strong policies we have established.

Under the Energy Efficiency Resource Standard adopted by the Arkansas Public Service Commission in 2010, utility energy efficiency programs have proven to be an important economic driver for Arkansas and advanced-energy technologies.

These programs have helped add 2,000 jobs and counting to the state’s economy.

That’s the finding of a 2014 economic study by the Arkansas Advanced Energy Foundation. It identified 675 contractors hired by the utilities to deliver their programs. The energy efficiency sector represents more than 9,000 jobs and more than $1 billion in annual sales.

A recent order by the commission will reinforce Arkansas’s reputation as a leader in energy efficiency. Utility energy efficiency-savings targets will be increased to 1.20 percent of 2018 baseline sales for electric utilities and maintained at 0.50 percent of 2018 baseline sales for gas utilities for the next three-year cycle, 2020-2022.

The ruling, which concurred with AAEA’s recommendations, will help ensure Arkansas continues along an upward path to maximize economic benefits.

The Arkansas Energy Performance Contracting (AEPC) program is a key cost-saving and economic development tool for state agencies, colleges and universities, and cities, counties and municipal utilities. AEPC has seen an explosion in interest since its start in late 2014. There have been 13 executed projects guaranteeing over $120 million in savings. AEPC is creating jobs, [reducing taxes], and conserving energy.

CEFF: What stakeholder decisions would catalyze forward movement in these two markets in Arkansas?

Niebaum: Tremendous potential exists to expand Arkansas’s advanced-energy economy. Policy makers are playing an important role in the utilization of energy efficiency and renewable energy measures to help create jobs and spur local economic development.

How can Arkansas continue to benefit from a growing advanced-energy economy? By setting policies that encourage market expansion.

That means continuing today’s fair value rate for “net metering” customers, home and business owners who have invested their own capital are installing solar systems that provides benefits beyond their own four walls. This is an active issue before the commission.

Additionally, the commission has opened a docket to explore a wide range of distributed energy resources, including energy efficiency; demand response; smart thermostats and controls; renewable resources and distributed generation, including solar and wind technologies; storage technologies; and electric vehicles, all of which may be enabled, enhanced and integrated into the grid via Advanced Metering Infrastructure (AMI).

Arkansas has seen considerable deployment of some types of DERs in recent years, and has risen from a "late starter" on DER installations at the beginning of the decade to the middle third among United States - or better - in many respects, according to a February 2018 analysis by the Regulatory Assistance Project.

Advanced-energy technologies provide jobs and energy savings in states that deploy them. By enhancing access to these resources, Arkansas can continue to lead in the advanced-energy economy.

Note: Emma McDonald contributed research to this article.

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