The Arkansas Public Service Commission has denied a request by Entergy Arkansas to approve a 20-year power purchase agreement for the proposed Big Island Solar facility, which would be located in Mississippi County. The 3,200-acre project, intended to generate 440 megawatts of solar power, had been described by Entergy as vital to meeting future energy needs and supporting renewable energy goals for Arkansas.
Entergy had also highlighted the project’s potential to advance Google’s renewable energy targets for its West Memphis data center, located a few miles from the solar facility, and to provide economic benefits for the state. Groundbreaking for the project took place on July 11, with officials touting it as the nation’s largest solar farm. Entergy estimated that the project could deliver between $29 million and $214 million in net benefits for customers over the life of the agreement.
However, in a 52-page decision, the commission concluded Entergy failed to meet Arkansas legal requirements for the approval of a long-term power purchase agreement. Commissioners determined Entergy did not provide sufficient evidence to show the agreement’s costs were reasonable or that the deal would save customers money compared to alternative options.
The commission identified several key concerns, including what it viewed as unsupported assumptions about the facility’s capacity benefits, fuel stability benefits, renewable energy credit values, fuel diversity benefits, and projected impacts of future carbon taxes. Entergy’s economic projections for the project, commissioners noted, relied heavily on revenue from renewable energy credits, which were still under negotiation with Google at the time of review and had not been finalized.
Commissioners also questioned claims about the solar facility’s contribution to capacity needs and whether Entergy had demonstrated a clear necessity for the project. They cited the utility’s access to the regional energy market and other existing or potential power generation options, including the possible conversion of its White Bluff coal units to natural gas.
Ultimately, the commission ruled Entergy had not established that the project was required for public convenience and necessity or for supplementing or replacing its existing generation resources.