The Cost Of Solar Energy In Arkansas

Jul 31, 2013

Credit Maggie Carroll/KUAR News

The South is starting to use more solar energy to power businesses and households. Texas led a 2012 spike in purchases of solar energy by ordering over 12 percent of the country's solar wattage, something until recently, almost exclusively done by the east and west coasts. 

 Drive by Little Rock's VA hospital and you'll see the largest number of solar panels in the state, right on top of their parking area. They are indicative of a regional move, albeit slight, towards solar. With Texas ordering 400 times the amount of solar panels that are on the VA hospital's parking lot, the south is becoming more interested in renewable energy.
  Chris Warren, a journalist and former editor of Photon Magazine, has covered all things solar. Last year, he began to see this significant change. 
 "There were these developments in the south that started to surprise me. Now I'm including Texas in this but also North Carolina, Tennessee, Gerogia...and over a series of months and you know, as long as a year, I could see that, there were some interesting developments that weren't driven by this normal paradigm of lots of incentives, it was, no incentives. And it made me realize that there were some market dynamics, that were starting to infiltrate parts of the country that had not been very keen on solar, " said Warren.

Solar power, the conversion of sunlight to electricity, is now gaining respect as a viable option for both household and corporate energy consumption, Warren covered this phenomenon in his piece, "The Revolution will be Solarized". 

"This came out, literally just a week after my story came out, the Solar Energy Industries Association which is the trade group, released its first quarter report about solar activity in the U.S." explained Warren, "and half of all generation, in the U.S. in the first quarter, was solar."

Arkansas's market is regulated, with very few electric companies providing all of the service to the public. Entergy Arkansas is one of the largest utilities in the state, and services 700,000 customers- 90 of those, are solar customers.
Entergy Arkansas Spokeswoman Sally Graham says the company is happy to help customers install net metering into their homes. Currently, nuclear and coal provide the bulk of power in the state. While the company supports solar, it has made no official decision to pursue it was one of its energy sources saying they believe solar's challenge is "its ability to compete on cost."

Net metering is something that helps solar users get more value from their panels. Appropriately 200 homes in the state use it. Net metering lets solar panel users receive credit for any energy they generate and don't use. Frank Kelly, a local financial consultant, was an early adopted of net metering. He and other solar supporters worked to get the "distributed Generation Act" implemented around the state. 

"We got net metering passed in 2001. By 2010 there were less than 50 net metering systems in Arkansas. So it wasn't working, we needed something else" said Kelly. 

J.D. Lowry with the Arkansas Energy Office says that from 2009 to 2011 Arkansas had a 1.8 million dollar rebate program, with a "large part" focused on metering installation.Within 18 months of starting the rebate program net metering showed a 400 percent growth, when compared to the previous 8 years that saw little metering installation. 

Credit Maggie Carroll/KUAR News

Lowry says,"where you see solar really taking hold in the United States are in areas with renewable portfolio standards or other incentives" but points out that though 32 states across the country have a renewable portfolio with specific standards that must be met, Arkansas does not.

The rebate program no longer exists, but there is still a 30 percent federal tax incentive available to those looking into the cost of renewable energy.

Bill Ball is the owner of Stellar Sun in Little Rock and is a solar panel expert. He has been involved with solar energy in Arkansas since the late 1970s and worked to create the Distributed Generation Act. When the rebate program was canceled, Ball attended the following legislative sessions to advocate for it. He says other states are now implementing the program. 
The state has yet to approve the rebate or any sort of incentives again. The cost of solar is still higher than traditional energy and therefore a less viable option for most people. 

While Arkansas Utilities offer the option of net metering, they do no invest in solar a source of power, as other southern states have started to do. 

The main issue becomes: what goes into calculating cost? When Warren interviewed the CEOs of large solar companies, global warming and pollution never came up. The issue was pure economics.

Author and journalist Chris Warren,"I think that the decrease of solar prices, makes it so that its more of an even swap. Oh okay, I can keep my lights on, I can do whatever I need to do, and hey- by the way, I can also help combat climate change. For a lot of people I think that's a pretty compelling  argument."