Solar to lower power bills 4.6% at Arkansas co-op

After adding enough solar capacity to reduce its costly peak load by about 30%, an Arkansas utility plans to cut electric bills by 4.6%. Expansion of a solar-powered factory that will yield 400 jobs is already under way.

October 15, 2019 William Driscoll

Ouachita Electric Cooperative's community solar project (partial view).

Image: Today's Power

The Ouachita Electric Cooperative, having added enough solar capacity to reduce its peak load by 30%, plans to file a docket with the Arkansas Public Service Commission for a 4.6% rate reduction, pending a final vote by the cooperative’s board on Thursday.

The fact that the cooperative’s costs went down from adding solar is “not what a lot of people expected,” said the cooperative’s CEO Mark Cayce in a pv magazine interview, as many have heard the common utility refrain that adding solar will increase costs.

Cayce explained the good matchup of solar power with peak demand: “Arkansas is a summer peak state, and when it’s 105 degrees it’s usually not raining.”

The rate reduction docket will provide more detail to justify the requested rate cut. Once it’s filed in the next two weeks, said Cayce, “I’m sure other utilities will want to look at how we’re doing this.” He also expects the Public Service Commission “to make sure everything’s correct” in the utility’s filing.

The cooperative utility’s largest solar project is a 12.5 MW installation located behind the meter of the utility’s largest customer, Aerojet Rocketdyne. Aerojet buys all the solar power that it can use, while Arkansas Electric Cooperatives Corporation, Ouachita’s wholesale supplier, agreed to buy the excess generation, as the cooperative utility was unable to do so.

And in an “exciting development around here, because we’re a small town in southern Arkansas,” said Cayce, Aerojet has started a major expansion that will employ 400 people, and will use all the solar power generated on site. Cayce counts the low cost of solar power, “which is much cheaper than the power we were selling them,” as a key factor in Aerojet’s decision to expand.

The electric cooperative has also developed a 1.6 MW community solar project, and helped change state law to permit the aggregation of 22 meters at Southern Arkansas University Tech, as a step toward its recently-completed 1.4 MW solar installation. Further savings come from the utility’s energy efficiency program, in which energy-saving investments are paid for on the electric bill, and which has reached almost 600 homes, reducing peak load by 1 MW.

“When you can add solar and add jobs and lower prices,” said Cayce, “everybody wins.”

Cayce received a standing ovation when he announced the rate-cut plan to attendees at the Arkansas Advanced Energy Association conference last week, as reported by Kyle Massey in Arkansas Business.

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