Solar Rebates And Incentives

Note: S.B. 295 was signed in March 2023, and changes related to interconnection were approved by the Public Service Commission in late September 2023 via Order No. 7 in Docket No. 23-021-R.

In April 2001, Arkansas enacted legislation directing the Arkansas Public Service Commission (PSC) to establish net-metering rules for certain renewable-energy systems. The Arkansas Public Service Commission (PSC) adopted net-metering rules in July 2002 (Docket No. 02-046-R, Order No. 4), which include interconnection requirements for net metering facilities interconnect to existing electric power systems (Section 3).* Systems that generate electricity using solar, wind, hydro, geothermal and biomass resources are eligible to interconnect and net meter. Microturbines and fuel cells using renewable resources, and energy storage, are also eligible. Net metering is available to residential systems up to 25 kilowatts (kW) in capacity and non-residential systems up to 5,000 kW.

Systems must meet all performance standards established by local and national electric codes, including the National Electric Code (NEC), the Institute of Electrical and Electronic Engineers (IEEE), the National Electrical Safety Code (NESC) and Underwriters Laboratories (UL). In addition, utilities may require facilities to meet any other safety and performance standards approved by the PSC. Customers must pay any equipment costs, including those necessary to fulfill safety standards. The PSC's rules require mutual indemnification, but do not address insurance requirements. In 2012, the PSC amended the Standard Interconnection Agreement to exempt local, state, and federal government entities and agencies from previously required indemnity agreements (Docket No. 12-001-R, Order No. 6). Utilities must use a PSC-approved standard interconnection agreement for interconnected facilities.

Arkansas requires customers to install a manual disconnect switch, to prevent any back-feeding when utility services are down. The switch must be accessible by the electric utility and clearly labeled. The utility has the right to disconnect and lock out the customer’s applicable facility from the electric system until the utility is reasonably associated that certain conditions have been corrected. Finally, the inverter must be properly installed and operated and may need to be inspected or tested by the utility. In 2023, the PSC amended manual disconnect switch requirements, removing exceptions for mandatory installment (Docket No. 23-021-R, Order No. 7). 

Electric utilities are allowed to charge customers a standard one-time fee either for each preliminary interconnection site review request submitted or at the time of interconnection once a Standard Interconnection Agreement has been executed. 

Customers may request their electric utility to conduct a facilities study, to estimate interconnection costs, including equipment, engineering, procurement, construction work, and various system upgrades necessary to safely interconnect. After a study has been conducted and the customer wants to move forward with interconnection, a standard Facilities Agreement must be completed, specifying the portion of the estimate interconnection service costs. 

* Municipal utilities do not fall under the PSC's jurisdiction and are not required to follow the PSC's rules. The PSC regulates investor-owned and cooperative utilities.