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Committee advances bill letting PSC approve cost recovery for gas alternatives and pilots
Summary
SB136 would amend the least-cost gas purchasing statute to allow the Arkansas Public Service Commission to let utilities recover reasonable costs for renewable natural gas and hydrogen demonstration projects if found in the public interest; the committee passed the bill by voice vote after questions about cost caps and equity.
Senate Bill 136, presented by Senator Irvin, would clarify the state's least-cost gas purchasing statute to allow the Arkansas Public Service Commission (PSC) to approve cost recovery for reasonable purchases of natural gas alternatives, including renewable natural gas and hydrogen, if the PSC determines the purchase to be in the public interest.
Ted Thomas, identified in the hearing as chairman of the Arkansas Public Service Commission, told the committee that the measure addresses two challenges: climate-related regulatory risk and the risk that strictly enforcing a least-cost requirement would stifle early-stage technologies. Thomas argued SB136 creates a limited exception so utilities can pursue demonstration projects at scale beyond laboratory tests while requiring PSC review and a public-interest finding before any cost recovery.
Committee members pressed on consumer protections and equity. One member asked whether confidentiality or consumer protections were included; sponsors said the PSC review would explicitly measure ratepayer impact per typical residential customer. Another member urged adding a legislative cap expressed as a monthly-bill impact (for example, a few cents per customer) to limit cost shifting; the sponsor said such a cap could be added but that the PSC would already evaluate monthly bill impacts when reviewing any plan.
Questions also addressed whether the bill's language on "methodology of production" is broad enough to cover innovations in extraction, landfill gas capture and distribution design (for example, horizontal drilling). Sponsors and the PSC representative said they intended the language to be broad and to allow PSC oversight of both production and network distribution issues. The committee passed SB136 by voice vote; the transcript records the motion and a second and indicates the motion passed but does not record a roll-call tally.
Next steps for SB136 were not specified in the hearing transcript beyond committee passage.
