PSC Allows Sierra Club To Intervene In Entergy Rate Case In Limited Role

File photo of Glen Hooks with the Sierra Club of Arkansas.
Credit Lilyan Kauffman

The Arkansas Public Service Commission on Wednesday grant limited status to the Arkansas Sierra Club’s request to intervene in Entergy Arkansas Inc.’s $167 million rate case, saying the environmental group had established “specific interests” to participate in the regulatory docket.

In an 18-page order, PSC Chairman Ted Thomas wrote that the Sierra Club could participate in the proceedings to argue if the costs of Entergy’s compliance with federal mercury and toxic air emissions were properly incurred. Also, the environmental group could argue if the utility giant’s “energy cost recovery riders” and rate design allowed for and encouraged energy conservation and development of renewable energy sources.

However, the PSC ruling signed by Thomas and fellow Commissioners Elana Wills and Lamar Davis noted that the Sierra Club’s petition had not shown any “unique interest” on behalf of ratepayers that were not adequately represented by the Arkansas Attorney General’s office.

“Accordingly, Sierra Club does not have standing to intervene as a ratepayer or as a representative of ratepayers,” Thomas wrote in the 18-page filing. “However, as an environmental organization interested in promoting environmental protection, energy conservation and renewable energy development, Sierra Club has shown that it will be directly affected by Commission action and that its interest is not adequately represented by other parties for the limited purposes discussed above.”

In response to Wednesday’s ruling, Sierra Club Director Glen Hooks hailed the panel’s decision to formally allow the environment group to intervene on a limited basis. He said the state’s largest environmental group would represent its members on several key areas regarding compliance with EPA rules, renewable energy investments and rate design.

Hooks also highlighted the fact that the group’s participation was “aggressively opposed” by Attorney General Leslie Rutledge, Entergy Arkansas and several other intervenors. The PSC staff formally responded to Sierra Club’s participation in the rate proceedings in late June, saying the state environmental group had not demonstrated how the issue of increasing residential electricity rates was not adequately represented by other parties in the docket.

“We are very pleased that the PSC has allowed us to participate and has rejected the challenge from Attorney General Rutledge and others. Sierra Club routinely seeks to promote sound environmental and energy policy in Arkansas on behalf of our members before utility commissions,” Hooks said. “It is unfortunate that our Attorney General sought to block Arkansas citizens from participating in a public process, but we are grateful that the PSC sided with Sierra Club today.”

In addition to the Sierra Club order, the regulatory panel also granted a June 18 petition by Arkansas Advanced Energy Association to participate in the rate case, but stipulated that it must take part “as a single and united intervenor with Sierra Club …”

“The Commission finds that AAEA’s interest in policy and rate structures in support of advanced energy technology is similar to the interest represented by the Sierra Club,” Thomas wrote in a separate order. “Having multiple entities participating as separate intervenors protecting essentially the same rights and interests in this proceeding would be administratively and judicially inefficient.”

NEWLY-CREATED SOLAR POWER GROUP FILES FINAL PETITION TO INTERVENE

To date, the list of current intervenors in the Entergy rate case includes Arkansas Electric Energy Consumers Inc., the Federal Executive Agencies (FEA), grocery giant Kroger Co., the Hospitals and Higher Education Group (HHEH), Bentonville-based Wal-Mart Stores, Inc., Evergreen Packaging Inc., AAEA and the Sierra Club.

There is still one remaining petition before the PSC from Scenic Hill Solar LLC, which filed to participate in the proceedings only minutes before a June 23 intervenor’s deadline. According to Secretary of State corporate filings, Scenic Hill Solar was incorporated as a limited liability company on March 4. In its PSC petition filed by Kutak Rock law firm, the group says it is engaged in the development of solar power facilities in Arkansas.

“The Commission’s ruling in this proceeding will directly affect Scenic Hill Solar and other solar power developers, and will influence how EAI accomplishes the transition from coal generation toward renewable resources such as solar,” argues Kutak Rock’s James Hathaway III. “A significant portion of EAI’s rate increase is related to the acquisition and power purchase agreements of advanced energy technologies, including solar power.”

On July 6, the PSC staff, the AG’s Consumer Utility Advocacy Division and other intervenors filed objections to the group’s petition to participate in the rate case. In the AG’s protest, Rutledge noted the late filing of the group’s incorporation papers and the lack of information concerning the LLC’s “commercial interest” in the rate case.

“Scenic Hill Solar claims to have solar projects ‘in development’ in various locations in Arkansas. However, Scenic Hill Solar does not provide any details regarding these projects. Moreover, Scenic Hill Solar was not created until March 4, 2015,” Rutledge wrote. “This is a rate case. At issue is EAI’s request for a general increase in rates and tariffs, as well as implementation of a formula rate plan. This is not a case seeking approval to build solar generation projects.”

Scenic Hill’s petition had not been approved or rejected as of Wednesday evening. Once all the interested parties have had a chance to respond to each party’s testimony or rebuttal throughout October, November and December, the PSC staff, intervenors and Entergy Arkansas officials must submit any settlement proposals to the commission by Dec. 31, 2015.

A public evidentiary hearing on Entergy Arkansas’ rate filing request will be held January 19, 2016, at the PSC’s headquarters in downtown Little Rock. Additional public comment hearings will be conducted in Batesville and El Dorado on Jan. 26 and Jan. 28, respectively.

In its 137-page filing in late April, the state’s largest utility makes the case to recover $167 million in new revenue that it said is largely driven by costs to upgrade the power grid and purchase the 495-megawatt power plant Union Power Station near El Dorado for $948 million in December.

If approved, the adjustment would change the monthly bill of a typical residential customer using 1,000 kilowatts per hour (kWh) by nearly $13.00 or 45 cents a day. The case is filed under PSC docket 15-015-u.