The Arkansas Senate passed a bill Wednesday that aims to make it easier for power companies to build novel projects, one week after it narrowly rejected an earlier version of the measure.
Senate Bill 307 would let utilities build power plants or other “strategic investments” with less regulation from the Arkansas Public Service Commission and charge customers higher rates to cover their costs. Its sponsor, Sen. Jonathan Dismang (R-Beebe), has said it’s a necessary step, given the increased demand for electricity production in the coming years and Arkansas’s aging fleet of existing plants. Its critics include both advocates for residential consumers and gigantic business interests wary of higher costs.
Reporter Matt Campbell outlined many of the objections to the original bill for the Arkansas Times last week. Dismang has since amended SB307 to address some concerns raised by other senators.
Dismang said Wednesday that utilities in Arkansas will need to replace or overhaul four power plants in the near future. Neighboring states have adopted similar financing mechanisms to the one found in SB307, he said, and Arkansas should do the same to avoid needing to import power from other states.
“Rates are going up, and the best way to control rates in Arkansas is to control our own energy production,” he said.
Critics of SB307, such as utility watchdog Daniel Tait, say similar policies in other states have only disadvantaged consumers.
Sen. Mark Johnson (R-Little Rock) spoke against the bill, saying it changed the balance of regulatory power “in favor of utilities and at the expense of ratepayers.” The bill was better after being amended, but it “still ain’t good,” he said, calling it a “Trojan Horse … to disguise the weakening of the [Public Service Commission’s] ability to protect consumers.”
The bill would allow companies to add a rider to customers’ bills to cover the cost of “strategic investments,” affecting constituents across the state. “I don’t know about you but I don’t want to get those calls when those bills hit their doors,” Johnson said.
Dismang dismissed Johnson’s objections, saying opponents of SB307 were failing to grapple with the state’s future electricity needs.
“We can pretend we don’t have to do something, and maybe that makes us feel good in the moment. Or we can accept that there’s a reality. We have to generate more power in Arkansas,” he said.
The bill will next head to a House committee.
