Entergy Follows The Sun, Along With U.S. Steel

Kurt Castleberry, vice president and director of resource management at Entergy Arkansas, says the state has transmission and fuel diversity advantages over Texas, where the power grid came within minutes of collapse in February.

With war in Ukraine driving a global energy crisis, Entergy Arkansas Inc. has turned to the sun nearly exclusively for new electricity generation.

Part of the idea was hedging against high natural gas prices, which were already up before Russia’s invasion sent them skyrocketing. In fact, Entergy itself cited higher gas prices last month in seeking a rate increase from regulators.

Sun and wind are the cheapest power generation sources now, making them attractive for savings, even beyond their environmental benefits. And sun power helped Arkansas bag its largest economic endeavor ever: a $3 billion U.S. Steel Corp. plant now going up in Osceola.

“We’ve been 100% solar in new generation in recent years, and that will continue,” said Kurt Castleberry, the investor-owned utility’s director of resource planning and market operations. “Our integrated resource plan filed with the Arkansas Public Service Commission last October calls for Entergy Arkansas to add about 3,000 megawatts of renewable resources by the year 2030.

“That’s a lot, but we’re bullish on renewable sources for the economics that they deliver for our customers. That’s not to mention the environmental benefits and the help in recruiting companies with corporate sustainability goals.”

Southwestern Electric Power Co., or Swepco, of Baton Rouge announced last month that some Arkansas customers are reaping power from the 998-megawatt Traverse Wind Energy Center in Oklahoma, “the largest single wind farm ever built at once in North America.”

Entergy has three major sun generation plants in Arkansas, and two others on the horizon. “The most recent, Searcy Solar, is producing electricity as we speak,” Castleberry told Arkansas Business. The Searcy project, with 100 megawatts of emission-free power and 350,000 modules, also includes lithium-ion batteries to store up to 30 megawatt hours of power.

That generation station came on the heels of the Chicot Solar Energy Center, another 350,000-panel, 100-megawatt behemoth that started generating in September 2020. Entergy Arkansas’ first solar farm, the 81-megawatt Stuttgart Solar Energy Center, began operation in 2018. Even bigger solar projects, West Memphis Solar and Walnut Bend Solar, near Forrest City, are regulator-approved, but slowed by tariff and import questions about modules built in Asia.

The utility-scale solar projects are part of Entergy’s commitment to replace older fossil-fueled units with green resources. Two coal-burning power plants, in Newark and Redfield, are scheduled to shut down at the end of this decade.

The Stuttgart, Chicot and Searcy solar projects, combined with Walnut Bend, will generate 381 megawatts of power, enough to operate about 61,000 homes. Unlike the Stuttgart and Chicot projects, built by NextEra Energy Resources of Juno Beach, Florida, and owned and operated by a NextEra subsidiary, the Walnut Bend plant will be built by Invenergy of Chicago but owned by Entergy.

“We also have our Green Promise tariff, which lets customers subscribe to a certain amount of renewable energy, and we’ve had a ton of interest from existing commercial and industrial customers,” Castleberry said. “It helps these businesses meet their sustainability objectives. Nowadays, there is hardly a new prospect inquiring about locating in Arkansas that doesn’t ask about renewable resources.”

Ted Thomas, chairman of the Public Service Commission, said recently that when U.S. Steel picked Arkansas, “we won because of sustainability.” Just look at the company’s news release announcing the plant, Thomas said. “It mentions sustainability seven times!”

Castleberry agreed that the project is huge. “They’re going to invest $3 billion in northeast Arkansas, and my gosh, that’s tremendous. You know, 900 jobs, $100,000 average salaries. That’s something we were very glad to help get for the state. Renewables were very important there, because like a lot of companies, they place great importance on sustainability. Their ultimate goal in northeast Arkansas is to produce steel using renewable energy.”

Castleberry said the wartime energy crunch underscores Entergy’s emphasis on having a diverse generation mix. “A good mix provides price stability for customers, and the solar resources we have added are paying off in that regard,” he said.

The Henry Hub price for natural gas, which was at just $1.74 per million British thermal units in April 2020, had more than doubled to $4.70 by the end of February, according to the U.S. Energy Information Administration.

“The situation overseas clearly affects natural gas prices here. But solar energy is now online and providing benefits to our customers,” Castleberry said. “And solar power is at the same price now as it was six months ago, before the Ukraine crisis came up.”