Little Rock-based utility Central Arkansas Water and Little Rock-based renewable energy company Scenic Hill Solar announced Wednesday (Dec. 16) a more than $7 million project to build a 4.8-megawatt DC solar array as the first to receive regulatory approval under a state law that expands access to solar projects.
The array will be built on 30 acres near Cabot and is expected to meet about 20% of the utility’s energy demand, save it more than $7 million in energy costs over 30 years, improve the environment, create a more sustainable utility and save ratepayers money, according to a news release.
The Arkansas Public Service Commission on Wednesday approved the utility’s application to construct a net-metering facility with a generating capacity of more than 1,000 kilowatts. This is the commission’s first approval of a net-metering facility of this size, the release said. In 2019, state legislators approved the Solar Access Act, now Act 464, allowing non-tax entities to receive third-party financing for solar projects.
“This solar facility is one part of CAW’s ongoing efforts to remain environmentally and economically sustainable for the benefit of customers we serve today and those we will serve in the future,” said Tad Bohannon, CEO of Central Arkansas Water. “We know that increased use of solar power improves the environmental sustainability of the utility and the communities we serve, but utilizing solar power also reduces costs and improves the economic sustainability of the utility for the benefit of our ratepayers.”
The project has been in the works for more than two years, and the utility has worked with Scenic Hill Solar over the past few months. The utility is expected to have immediate savings in its annual power usage, the release claimed.
The array will be built on land owned by the utility near the Main Street exit off Highway 67/167 near Cabot. The utility will lease the land to Scenic Hill Solar for the construction and operation of the plant. It’s expected to start operating in mid-2021. In an agreement, Scenic Hill Solar will sell electricity generated by the array to the utility at 5.1 cents per kilowatt-hour. The 20-year agreement includes two five-year options to extend.
“Central Arkansas Water provides a vital resource to almost 500,000 Arkansans, and we are proud to provide solar electricity that reduces costs to Arkansans and improves the environment of the Natural State,” said Bill Halter, CEO of Scenic Hill Solar. “Scenic Hill Solar will invest more than $7 million into the central Arkansas economy through this project.
“We are proud that this project is the first of what we hope will be many to be approved under Act 464,” he added. “The Arkansas Public Service Commission ruled in our favor and overruled Entergy Arkansas objections on multiple questions. This ruling confirms that remote site net metering facilities are allowed under Arkansas law, that renewable energy certificates are the property of the customer to do with as they wish, and that 20 years of grandfathering of rates will apply to the Central Arkansas Water project. These are hard-fought victories for Central Arkansas Water and all Arkansas ratepayers.”
Following is a statement from Entergy Arkansas on this project: “We are reviewing the order now, and it is our understanding that the commission approved this private solar project that benefits a single customer at the expense of all other customers, including residents, small businesses and major employers. Entergy Arkansas is continuing to develop large, utility-scale solar arrays that provide benefits for all of our customers at a significantly lower cost for everyone.”
The 4.8-megawatt solar array will have more than 12,300 panels; operate on a ground-mounted, single-axis tracking system; and produce more than 8.24 million kilowatt-hours of electricity in the first year of operation and over 228.72 million kilowatt-hours of electricity over the next 30 years. The array also will provide environmental benefits equal to the removal of 400 million passenger car miles from the highway and produce enough electricity to power nearly 1,000 homes annually, the CAW release said.
“This solar facility will not be CAW’s last solar facility,” Bohannon noted. “CAW continues to explore additional ways to add solar power and other programs that improve CAW’s environmentally friendly operations.”
Central Arkansas Water is the largest drinking water utility in Arkansas with nearly 500,000 customers across seven counties.