Stalled energy bill advances out of Arkansas Senate

Left image: Republican Sens. Jimmy Hickey and Missy Irvin listen at their colleagues cast their vote for Senate Bill 307 on March 12, 2025. (Antoinette Grajeda/Arkansas Advocate) / Right image: The Entergy Independence Power Plant in Newark, which is scheduled for closure in 2030.

Arkansas lawmakers approved an amended bill on Wednesday to streamline the process for building electricity-generating plants in the state, one week after rejecting the original proposal.

Lead sponsor Sen. Jonathan Dismang, R-Searcy, said Senate Bill 307 aims to mitigate the spike in rates expected as a result of purchasing or generating new energy that will be needed for the state’s growing population and the closure of at least two coal-fired plants — one being the Entergy Independence Power Plant in Newark — in the next five years.

After the Arkansas Senate rejected SB 307 last Wednesday, senators on Thursday approved a motion by Sen. Jimmy Hickey, R-Texarkana, to request recommendations on the bill from the Arkansas Public Service Commission. Hickey told the Advocate the utility commission’s analysis “mostly definitely helped” and resulted in 12 pages of amendments for the 63-page bill.

“It’s a very complicated subject, as we keep saying,” he said. “I know that I put the PSC probably in an untenable position because you’ve got legislators wanting certain things and the other ones the other way, but again, they’re our regulatory agency who’s been doing it. So I just felt that they had to weigh in.”

Hickey helped craft one “important” amendment that states if at any time during the construction process the commission finds any costs were not “prudently incurred,” the PSC shall order those costs to be refunded to customers through bill credits.

“Just thought that was going to be an extra good guardrail or another good tool for them to keep everybody on the up and up,” he said.

The process outlined in SB 307 is already being implemented in surrounding states, though Dismang said he’s not sure they have “this extensive amount of parameters in place.”

Dismang explained last week that under the current model, interest is accrued during construction and then capitalized, creating “a significant jump in rates” once the power plant is operational. SB 307 recommends another option that would allow utilities to begin recovering costs incrementally during construction by enabling “a strategic investment” that he said would result in a “lower, long-term recovery rate for consumers.”

Arkansas could “pretend like we don’t have to do something,” but inaction would leave the state “at the mercy” of neighboring states that have decided to create new power, Dismang said.

“I want Arkansas to be a leader in every possible way, and this sets us up to be a leader,” he said. “Rates are going to go up because we have to create new power or we’re going to have to buy new power from someone else. I want to be in control of that.”

The Arkansas Advocate is a nonprofit, nonpartisan news organization dedicated to tough, fair daily reporting and investigative journalism that holds public officials accountable and focuses on the relationship between the lives of Arkansans and public policy.