• The PSC is considering Entergy’s first major rate case in 11 years, giving the public a rare look at the company’s finances and cash flows.

• Entergy’s advertised “about 1%” impact may understate real bill effects for many customers. Independent groups argue that average residential increases could be closer to ~5%, with larger impacts for small businesses (over 7%) and some agricultural irrigation customers (approaching 12%).

• Public participation matters. You can participate in person at the public hearings or by submitting written comments through the Public Service Commission's website.

With SWEPCO’s rate case decided, Arkansas’ Public Service Commissioners are now preparing to work on Entergy Arkansas’ first major rate case since 2015. As we covered in a previous article, Entergy has been steadily raising rates on customers using the Formula Rate Plan (FRP), but for the first time in 11 years, onlookers are going to get a first-hand look into the company’s cash flows as major changes are coming to the power grid in Arkansas.

“Entergy Arkansas has not done a full rate case since 2015, and this year we have a brand new Entergy rate docket that is open,” Southern Renewable Energy Association Executive Director Simon Mahan said. 

With over 735,000 total customers, including over 600,000 residential customers, Entergy Arkansas is the largest electricity utility in the state.

Entergy has advertised the rate case as only lifting rates by around 1% for an average household, or about $1.16 on a monthly bill. But as Mahan explained, the advertising is slightly misleading.

Arkansas Advanced Energy Association Executive Director Lauren Waldrip said the Association's independent review paints a different picture than the one presented in Entergy's public messaging.

"While Entergy has emphasized little or no impact for many residential customers, our analysis suggests the average residential increase is likely closer to five percent,” Waldrip said. “The proposal also raises rates by more than seven percent for many small businesses under the Small General Service rate class, and our review of the agricultural irrigation rate indicates farmers could see increases approaching 12 percent. At a time when Arkansas families, small businesses, and producers are already managing rising costs, it's critical that these impacts are fully examined before new rates are approved."

These proposed changes are in addition to the Generating Arkansas Jobs Act (GAJA) Rider ratepayers began seeing on their bill last month of over four percent on average as a result of the new CWIP - or Construction Work in Progress - law utilities pushed through the legislature last year. Entergy has been slowly-but-surely lifting rates over the last decade through the Formula Rate Plan. 

Now, they are asking the Commission to formally include those marginal rate increases into the base rate while also asking for an increase on top of it. 

 The case, which includes thousands of pages of documents from Entergy Arkansas’ last 10 years of operations, is, for lack of a better term, a doozy. But for utility nerds and anyone else trying to get in the weeds, the docket offers one of the best opportunities in years to really see behind the curtain.

“On the back of your Entergy bill, there’s a line item called the Formula Rate Plan, so it’s not a bunch of separate things. It’s essentially one line item. And in at least the last month, that line item was about 52% of your total bill,” Mahan said. “That means that Entergy’s rates were last set back in 2015. Since then, the utility has been allowed to tack on roughly four percent each year, year after year. The catch is that those increases are happening through a process that doesn’t require the same kind of ‘big’ approval each time—so they’re not rolling all of it into rate base the way you might expect. But the end result for customers is still very real.”

Mahan said that over the span of a decade, that four percent compounding effect adds up, and the Formula Rate Plan—because it’s around that 52% mark—has driven major increases in the bill you’re seeing. “So in this latest rate case, they’re basically asking the commission to approve that 52% as the new base rate, and then add another one to two percent on top,” he added. 

Waldrip said the proposal goes beyond simply updating existing rates.

"Entergy is also asking the Commission to authorize a higher return on equity, or the profit shareholders earn on the utility's investments. That's particularly significant because Arkansas recently expanded Construction Work in Progress (CWIP), allowing the company to begin recovering the cost of major generation projects before the projects even start construction,” Waldrip said. “One of the traditional arguments for a higher return is that investors assume greater financial risk. But when customers begin paying earlier through CWIP, much of that construction risk is shifted away from investors and onto ratepayers. We believe the Commission should carefully consider whether a higher shareholder return is justified when customers are already bearing substantially more of the financial risk."

If you can stomach an intense document dump, a decade of financial information from Entergy Arkansas (with major redactions) is available in the rate docket, which is titled 26-001-U and can be found on the Arkansas Public Service Commission’s website.  

Only a handful of organizations have formally intervened in the proceeding. Beyond Entergy Arkansas, the Arkansas PSC, and the Commission's professional Staff, only nine organizations have become parties to the case. By intervening, organizations like the SREA and AAEA are able to review confidential filings, question witnesses, conduct discovery, and present expert testimony on behalf of Arkansas consumers, businesses, and the state's advanced energy industry.

"Every Entergy customer will be affected by the outcome of this case, but only a small number of organizations are actively participating in the legal process," Waldrip said. "We believe it's important that the interests of all Arkansas ratepayers - businesses, employers, manufacturers, and energy users are represented as these decisions are being made.”

Entergy Arkansas’ 2026 rate case will undoubtedly be one of the most consequential cases the Public Service Commission considers this year, and it offers an excellent chance for any Arkansan concerned about rising electricity rates and the source of their electricity, a great way to plug in and get involved with utility policy.

The changes shaping Arkansas’ energy future are already affecting what is included on the bills arriving in our mailboxes and how utilities justify their investments. If you’re a ratepayer, business owner, or advocate for affordable energy, your voice matters. 

How to Get Involved

The Arkansas Public Service Commission encourages members of the public to participate in the rate case, and offers two ways of participating:  

• In person at the first public hearing on Wednesday, July 29 at 6pm at the Arkansas Public Service Commission's Hearing Room (1000 Center Street, Little Rock). 
• Or online: Those unable to attend in person may submit comments directly to the Arkansas Public Service Commission online.

"Public participation matters," Waldrip said. "These proceedings determine what Arkansas families and businesses will pay for electricity for years to come. Whether you testify in person or simply submit a written comment, your voice becomes part of the official record and helps inform the Commission's decision."

Writers with the Southern Renewable Energy Association and Powering Arkansas are writing these stories because regulatory decisions shape everyday life, from affordability to reliability, and yet they’re still often a mystery to the average consumer. Our aim is to provide transparent recaps of these meetings and show how you can participate in public comment or hearings. Keep up with regulatory affairs in Arkansas by following Powering Arkansas on Facebook and sign up for email updates.