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PSC Sets New Efficiency Targets For Investor-Owned Power Utilities

Arkansas Business // July 16, 2018

by Kyle Massey

The Arkansas Public Service Commission has set new energy efficiency goals for the state's electric utilities, ordering a savings target of 1.2 percent of baseline energy sales from 2020 through 2022.

The targets, approved Friday by the three-member commission of utility regulators, mark a significant increase from previous efficiency targets, which were set at a maximum of 1 percent. The new goals should "establish Arkansas as a leader in energy efficiency savings in the South," according to a news release from the Sierra Club, which joined Audubon Arkansas and the Arkansas Advanced Energy Association in recommending the new targets. The three groups projected that the new goals will save some 445 million kilowatt hours of power per year in Arkansas.

"The commission's order is a win for Arkansas' electric consumers," said Casey Roberts, senior attorney for the Sierra Club. "The commission established increased but completely achievable energy savings targets for the utilities that will require them to expand access to their energy efficiency programs. These expanded programs will save customers money while making their homes more comfortable and reducing air and water pollution."

Roberts told Arkansas Business that the savings embraced in the new goals have actually already been achieved. "The PSC looked carefully at the utilities' successful programs to date, saw that they had already been achieving annual savings of 1.2% or more, and refused to set goals that would allow backsliding in these programs," she said.

Entergy Arkansas, the state's largest investor-owned utility, issued a release through representative Kerri Jackson Case: "Entergy Arkansas actively participated in the Arkansas Public Service Commission's process for energy efficiency. We support the new targets, and will update our programs to meet these goals."

The commission has been setting statewide energy savings targets for all investor-owned utilities in Arkansas since 2013. But in May, a group of stakeholders established by the PSC, Parties Working Collaboratively, but no consensus was reached on goals. The disagreement generally broke between a group of efficiency advocates pushing for higher goals and a group largely made up of utilities advocating maintaining lower savings targets. The commission eventually sided with the efficiency advocates.

Katie Laning Niebaum, executive director of the Arkansas Advanced Energy Association, a trade group, praised the decision. "Arkansas is recognized as a leader in the energy efficiency sector, not just in the Southeast but at a national level, due to the strong policies we have established," Niebaum told Arkansas Business. "These energy efficiency programs have proven to be an important economic driver for Arkansas and advanced energy technologies. The Commission’s ruling will help ensure we continue along an upward path to maximize economic benefits." 

"Today's decision will encourage Arkansas' electric utilities to continue to improve and expand their efficiency programs, which is great news for Arkansas," Gary Moody, the public affairs director for Audubon Arkansas, said in a news release. "Smarter, more efficient energy use not only saves utilities and their customers money, it creates good local jobs and protects our natural environment. The cleanest power source is the energy you never have to generate in the first place."


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