Renewable energy study gives Arkansas good marks

Editor’s note: Roby Brock, with our content partner Talk Business, wrote this report. He can be reached at [email protected]

A new study from Duke University and Georgia Tech contends that Arkansas is leading 16 Southern states in renewable energy generation, but is poised to do much more.

Dr. Marilyn Brown, a researcher of the study titled “Renewable Energy in the South: A Policy Brief,” says about 9% of Arkansas’ energy production portfolio currently comes from renewable sources, primarily hydropower.

"Looking to the future, the potential for growth is very significant, much better than any other Southern state because it has wind, hydro and biomass resources, and solar resources are pretty good, too," Brown said in a recent interview.

Brown contends that renewable energy standards are an increasingly attractive economic development tool for many states and Arkansas could capitalize on its momentum.

"Companies are now asking, ‘Who’s got the commitment to this new generation of clean tech and green energy?’," she said.

Arkansas has recently landed a number of high-profile companies, such as wind energy giants LM Windpower, Nordex and Mitsubishi, in part due to tax incentives, central location, a diverse transportation infrastructure, and a recruiting effort to chase alternative energy employers.

But Brown suggested other states have more aggressive policies to improve their renewable energy mix and without a similar strategy, Arkansas could lose its top Southern billing.

"Twenty-nine states right now have these quota requirements for their utilities," Brown said. "Arkansas does not. So right now, Arkansas is in a lagging position in terms of advancing through policies."

Could the state make a move? With a legislative session in full swing, Arkansas lawmakers could dictate a renewable energy standard. But the Public Service Commission also has rule-making authority and could mandate a threshold.

Newly named PSC Chair Colette Honorable, who has spent four years at the state regulatory agency, says the issue still warrants further review.

"Our commission make-up has changed and so I wouldn’t be in such a position to tell you — without knowing the benefit of this particular commission’s thoughts on that subject — whether it would be something we would be open to doing," Honorable said in reference to the recent appointment of a new commissioner.

Elana Wills replaced former PSC chairman Paul Suskie earlier this year. Olan "Butch" Reeves is the final commissioner on the three-person PSC panel.

"I certainly recognize that we are among several states that doesn’t have a [renewable energy] standard. I think its something we should continue to evaluate. I’m not prepared today to say that we must have one. But I am committed to evaluate that matter and to ensure that all the proper information comes before the commission before we take on those challenges," Honorable added.

The PSC does have a docket open to further study the issue.

Another factor that could impact Arkansas’ advancement in renewable energy involves future federal regulatory changes. The Environmental Protection Agency seems bent on making more stringent air and water quality standards.  That could force electric companies in Arkansas and elsewhere to invest in a more diverse renewable energy portfolio.

As the time comes to retrofit older coal-fired plants, Brown says that the capital investment may be better spent on greener technologies.

Nuclear power generation, which plays heavily in Arkansas’ non-coal and non-natural gas electricity production, was not counted in the Duke-Georgia Tech study as a renewable energy resource.

However, biomass was and Arkansas has only scratched the surface on its use as a contributor to electric power.

"Biomass is likely to play a bigger role in Arkansas’ future," Brown said. She sees it serving more of a function in powering factories versus generating enough electricity to return to the grid, for now.

"[Biomass] will be either at the power plant to co-fire with coal or dedicated biomass-to-gas-to-electricity facilities, which could be located at a pulp-and-paper industry or standalone facility that could use some of Arkansas’ great agricultural land to produce power," she said.

Brown says biomass — which includes switch grass, crop residues, and forest byproducts — is not a natural resource to haul very far.

"You want to be able to use it very close to where the resource is grown," she noted.

But she says as technology advances and efficiencies are achieved, it is possible that a factory in South Arkansas processing timber into 2×4’s could see its lumber products become a secondary revenue generator.

"In the future, where we’re facing issues with respect to clean power, you might see more of that, where the power production becomes your principal product."