Panel backs bill protecting non-export customer generation after hours-long debate over cost-shifting and PSC role

The Senate Insurance & Commerce Committee approved Senate Bill 615 after extended debate over whether customer-owned generation that does not export power to the grid should be treated differently under state law.

Sponsor Sen. Clint Penzo told the committee the bill “protects customers energy choices without undermining utility revenue,” and argued the measure aligns Arkansas law with federal protections for qualifying facilities. Jordan Tinsley, vice president at Bernhard with regulatory experience, added that “this bill clarifies that facilities that are not selling power back to the utility are not net metering facilities.”

Entergy Arkansas testified in opposition. John Bethel, director of public affairs for Entergy Arkansas, said the protections the bill seeks already exist in federal law and state tariffs, and warned the bill risks undoing recent changes that prevent cost-shifting from distributed generation. Bethel said the legislation could enable facilities sized to exceed customer needs and inadvertently export power: “If they are on an interruptible tariff and are putting power to us, they’re not providing the interruption or the level of interruption that we’ve contracted for,” he said.

The Arkansas Public Service Commission’s chief of staff, Danny Hofer, told senators the PSC has no formal position on the bill but noted the commission’s orders must prevent unreasonable cost shifts; she said PSC authority to prevent cost shifting would not be changed by the bill. Committee members sought and obtained additional language — a verbal amendment — authorizing the PSC to develop rules and to set capacity limits. Senator Penzo proposed delaying the effective date until March 1, 2026, to give the PSC time to promulgate rules and to allow the PSC to “put any necessary limit on capacity size.”

Committee action: The committee adopted the sponsor’s amendment and voted to pass SB 615 as amended (voice vote recorded as “aye”).

Why it matters: The measure addresses conflicts between utilities and customers or large commercial users who install behind-the-meter generation. Utilities argue such measures may lead to lost revenue or cost shifts; sponsors and business proponents argue customers should be able to install non-export generation without discriminatory tariffs.

Next steps: The amended bill was reported favorably out of committee and will move forward in the legislative process.