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Arkansas and Energy: A Business Convergence

4 min read

The stars, and particularly that fiery ball just 92 million miles from us, have aligned for Arkansas Business’ debut column on energy, a new monthly feature.

President Joe Biden rejoined the Paris Agreement on Climate Change and halted the controversial Keystone pipeline as he reached the Oval Office. Climate change is once again a national enemy.

Engineers envision a remade electric grid to make the most of solar and wind energy, battery storage and increased distributed generation. And Arkansas is fertile ground for the revolution.

The state emerged as an electric power titan in World War II and is home to two regional transmission organizations, Southwest Power Pool and the Midcontinent Independent System Operator, which oversee the electrical grid in multiple states and are steadily incorporating more wind and sun power.

Independent solar contractors in Arkansas have seized on a growing market fueled by steadily falling installation costs, favorable state regulatory policies and federal incentives that stand to be renewed under Biden. The Democrats’ slim advantage in the Senate, a 50-50 balance tipped by Vice President Kamala Harris as tie-breaker, does not ensure a sweeping Green New Deal or a $2 trillion climate plan. But prospects for renewable energy and anti-carbon measures have vastly improved since November.

Solar installation is booming across the state, with companies like Entegrity of Little Rock, Seal Solar of North Little Rock and former Lt. Gov. Bill Halter’s Scenic Hill Solar building power plants for schools, cities and water districts, farms, businesses and nonprofits.

“The Biden administration is definitely pro-renewable energy,” said Entegrity partner Matt Bell. “And the state is doing a great job with legislation like the Solar Access Act,” which opened up third-party contractors to non-taxed customers like counties and universities.

Shine Solar of Rogers has soared as a regional player in residential projects, building in four states and aiming for $100 million in 2021 revenue. This month, Shine named former Overstock.com CFO David Chidester as its CFO-adviser, citing sustained company growth.

Entergy Arkansas, the state’s largest electric utility, has also been the state’s biggest solar builder. Stuttgart Solar near Almyra and Chicot Solar near Lake Village, at 81 and 100 megawatts of capacity, are already pumping out power. Another 100-megawatt station is being built near Searcy, and “if things go according to schedule that should be online later this year,” said Kurt Castleberry, the utility’s director of resource planning and market operations. A fourth project, a 100-megawatt station near Brinkley called Walnut Bend Solar, is pending regulatory approval but could be operational in 2023.

Castleberry also revealed last week that Entergy has asked the Arkansas Public Service Commission to approve its fifth and by far biggest solar station near West Memphis, a 180-megawatt plant that with commission approval “could come online sometime in the latter part of 2023.”

Castleberry, Bell, Seal Solar CEO Josh Davenport and Arkansas Electric Cooperatives CEO Buddy Hasten will all be panelists in a virtual roundtable discussion of solar power Feb. 16 for the Rotary Club of Little Rock. I’ll be moderating the discussion, which should touch on the third-party solar boom, Entergy’s economic arguments for its huge solar farms, and Hasten’s warnings that taking too hard a turn against fossil fuels could dramatically increase the cost of electricity. That, he says, could be costly in Arkansas, which has some of the nation’s cheapest retail electricity and has made that part of its industrial recruitment pitches.

Of course, electricity isn’t Arkansas’ only big energy story.

Biden’s cancellation of the Keystone project will reverberate at Welspun Tubular LLC, which has a 500-worker plant at the Port of Little Rock and a contract to make a million feet of 36-inch pipe for the project.

Canada’s Standard Lithium is working with Lanxess to launch a new energy industry near El Dorado: extracting battery-quality lithium from underground brine formations.

The natural gas boom, unleashed by fracking but undermined by a huge glut in the gas market for a decade, could stir again with the U.S. Energy Information Administration predicting higher prices.

And Energy Security Partners of Little Rock is still pursuing a seemingly improbable dream of a $3.5 billion facility for turning natural gas into diesel and other liquid fuels north of Pine Bluff.

Look for updates on these topics and more every month here, and examine our Energy Newsletter, now a weekly feature. You can get it free of charge at arkansasbusiness.com/enews.

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