Advanced Energy Measure Sent to Governor After Unanimous Senate Approval

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Legislation that would help spur energy efficiency and renewable energy projects among the state’s public entities, including schools, earned strong support from the Arkansas Senate today, and will be sent to Governor Asa Hutchinson for his signature.

In a 34-0 vote, Senators gave their endorsement to House Bill 1636, which would enhance the state’s energy performance contracting program by providing public entities with additional flexibility and support utilizing the economic development and cost-saving initiative.

“The Arkansas Energy Performance Contracting program is a significant economic development initiative for the state, a driver of advanced energy jobs and a key cost-saving tool for Arkansas’s public entities,” said Katie Niebaum, AAEA Executive Director. “The program’s success has been a top association priority since AAEA members helped to secure its adoption in 2013. AAEA sincerely thanks bill sponsor Representative Rick Beck and Senate champion Senator Lance Eads for their leadership supporting advanced energy jobs.”

Arkansas Energy Performance Contracting provides the state’s public entities the opportunity to utilize guaranteed energy savings to improve the energy and operational efficiency of their existing facilities without the need for upfront capital.

HB1636 would allow a guaranteed energy cost savings contract to be extended if its energy cost savings measures possess either an active equipment warranty period or a combined useful life in excess of 20 years. Current law sets a maximum term at 20 years. The contract length extension would put Arkansas in line with federal government standards and allow for solar systems to become a driver of projects given the decreasing costs and long warranties of equipment.

The proposal also would allow school districts to opt into the existing program rules and regulations, therefore allowing all public entities the ability to utilize the ADEQ Energy Office as a program administrator. School districts in increasing frequency have sought guidance and followed program rules, though K-12 currently falls outside of the program.

AEPC has seen strong interest since its start in late 2014; 21 projects have been fully executed or are in active development, with total executed contract value worth $102.5 million guaranteeing nearly $150 million in energy savings. Those figures are expected to more than double by the end of 2019. Approximately 9,000 Arkansas jobs are tied to energy savings equipment and services and are directly affected by a vibrant AEPC program.

AAEA members serving the AEPC program as pre-qualified energy service providers include Bernhard Energy, Clear Energy, Entegrity, Johnson Controls, McKinstry, Performance Services, Scenic Hill Solar, Schneider Electric, Trane Arkansas and Today’s Power, with many more advanced energy companies delivering services as a result of this initiative.

Jennah Denney