Insurance & Commerce - Senate and House
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Bills discussed (1)
| Bill | Title | Sponsor | Status |
|---|---|---|---|
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HB1813
· 1 mention in transcript
Matched: “…ank you for your time, committee. So the original intent of House Bill 1813, which was an act to adopt the Ferring Efficient Transmissi…”
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TO ADOPT THE FAIR AND EFFICIENT TRANSMISSION COMPACT. | Gramlich | Recommended for study in the Interim by the … |
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- October 6, 2026
Unknown speaker
0:00
Thank you.
Thank you.
Thank you.
Thank you.
Representative John Maddox
Unverified
2:00
Good morning. Let's go ahead and call this
meeting to order. Glad to see so many people able to make it here today. We have a fairly busy agenda, but the first thing we need to do is we need to recognize we need to handle some motions. The first matter is a motion to approve special expenses. Representative Boyd, Senator Boyd, makes the motion.
Do we have a second by Representative Stimel? All in favor say aye. Aye. Any opposed? Motion carries. Thank you, Senator Boyd. Agenda item C is the minutes. Has anyone had a chance to review the minutes? Senator Boyd will make a motion and a second by Senator Irvin. All in favor say aye. Aye. Any opposed say no. Motion carries.
Committee members, the next thing we have to do is we have numerous ISPs. My thought is that we will batch those. And do I
have a motion to adopt the ISPs as batched? sir boyd mr. chair I'd like
Senator Justin Boyd
Unverified
3:27
to make a motion that we adopt all the ISPs two through nine but we do not adopt number one and we take up that one separately
Representative John Maddox
Unverified
3:37
please okay senator Boyd has made a motion to have a second we're the ladyman all in
Senator Justin Boyd
Unverified
3:56
favor say aye okay mr. chair may I make a motion that we now adopt 10 through 50 ISPs 10 through 15 yes Senator
Representative John Maddox
Unverified
4:02
Boyd has made a motion to go ahead and get the rest of them 10 through 15 do we have a second
Speaker 24
4:07
resident ladyman seconds it I'll grab some gram like
Representative John Maddox
Unverified
4:33
you're recognized that's mine thank you represent Graham like what it was my thought that we would go ahead and adopt your motion adopt your ISP but you are on the agenda to present thank you okay
so I think we are going to vote on the motion all in favor say aye aye any opposed say no motion carries mr. chair may I make
Senator Justin Boyd
Unverified
4:55
a motion on number one yes Senator Boyd, make your motion. Really, I'm just
Representative John Maddox
Unverified
5:00
going to be honest. I don't know
Senator Justin Boyd
Unverified
5:03
the motion to make, but we want it to go away. We want it to be withdrawn. We want it
to die. We want it to not be brought up for consideration or be hanging out there other than it's just filed.
Representative John Maddox
Unverified
5:16
Motion to kill your ISP. Yes, that's what I need. All in favor, say aye. Aye. Any opposed, say no. Motion carries. The ISP is killed. Committee members, are there any other ISPs we need to address specifically before we turn to Representative Gramlich? Okay, thank you. Representative Gramlich, you're recognized if you'd like to go to the table.
Sure. Representative Gramlich, as you're making your way to the table, we have other people. You're welcome to bring them to the table with you if you want to.
That's completely up to you. I'd appreciate that,
Speaker 39
6:27
Mr. Chair. Um, yeah, there was a number of individuals, uh, from various, various, uh, different organizations, um, from the Southwestern power pool, from,
uh, Becker Corp, uh, the public service commission and, uh, from EPL advisors. If they could all come forward, please. And I'm going to find an
Representative John Maddox
Unverified
6:41
additional chair. Okay. Thank you. A few gentlemen would come forward and we'll find one more chair.
And then once you get there and get seated, just introduce yourselves for the record. State representative, Zach Gramlich, District 50.
Speaker 48
7:20
Brent Bailey, EPL Advisors. Danny Hover, Chief of Staff at the
Representative John Maddox
Unverified
7:35
PSC. Daniel Berkowitz, Becker Corporation. Steve Purdy, Southwest Power Pool.
Speaker 39
7:39
Thank you. Representative Gramlich, you are recognized to present your ISP. Thank you for your time, committee. So the original intent of House Bill 1813, which was an act to adopt the Ferring Efficient Transmission Compact
and for other purposes, The goal of this compact was really one thing, and it was to increase, you know, the number of – excuse me, lower permitting times and allow for more transmission lines to be run across our state and across our region. The reality is – well, I'll tell you my story first. So I look at my hometown, Fort Smith. We have transmission problems, not with electricity, but it's with wastewater. We spent entirely too long and kicked the can for entirely too long. And now we're, you know, we're having to spend millions and billions of dollars to fix the sins of our forefathers.
And I don't want to see the same thing happen to us with electricity. You know, we are in an unprecedented time of growth in electricity in our nation with AI centers, with data centers, and tons of other load that are coming online every single day. And I don't want Arkansas to be left in the dust because we didn't do what we needed to do. And so really this is just an opportunity to have a conversation about the importance of transmission and what we need to do next to ensure Arkansas policy is good for transmission building in our state.
And I'll let any of these people
Representative John Maddox
Unverified
9:06
add anything they'd like. If we would like to go in
order, Mr. Purdy is first. If you'd like to go ahead and
Representative Jim Wooten
Unverified
9:13
introduce yourself again and present your testimony, please. Sure. Good morning. I'm Steve Purdy. I am the technical director for engineering policy for Southwest Power Pool, and I'm going to speak a little bit this morning on transmission planning and what goes into that and some of the complexities involved in that.
I did bring some slides, so we can go ahead and go to slide number four. Just some little background on Southwest Power Pool. SPP is what's known as a regional transmission organization. That is a nonprofit entity that is registered by the Federal Energy Regulatory Commission, or FERC, to manage the access to the high-voltage transmission system for utility members.
And SPP, as you can see from that diagram, our members that have their facilities under SPP's control are in the center part of the country, that dark red area in the middle. SPP is one of nine regional grid operators in North America. We have 130 members that participate, and SPP offers a number of services. We act as sort of an air traffic controller for the high-voltage transmission system,
But we also are in charge of balancing supply and demand across the region on a minute-by-minute basis. We're responsible for maintaining reliable grid operations and ensuring that the lights stay on. We also operate a wholesale energy market where we pair sellers and buyers of energy so that they can access the most economical resources. And then what we're here to talk about today is we also coordinate planning for new transmission across the entire region.
So if we go to the next slide, SBP has, as I mentioned, 130 members. And that's part of what helps us keep our independence is that we have members all across the spectrum of utilities that use the high-voltage transmission system, Everything from cooperatives to investor-owned utilities, municipals, as well as large customers such as Walmart and others. So the SPP really strives to bring everyone that has a stake in the high-voltage system and the energy system in general together
to develop the policies and procedures that will be used to provide those services that we just talked about. SPP covers all are part of 14 states. We have over a thousand generating plants, over 5,000 substations, and over 70,000 miles of high-voltage transmission within that area, and it serves a population of around 18 million. On the next slide, I just want to mention a little bit about SPP being as we are in Arkansas. I thought it would be of interest to this group if you're not familiar with SPP.
It started as a cooperation between 11 member utilities in 1941 in order to bring power to the central Arkansas area in order to smelt aluminum. There wasn't enough power that existed in Arkansas at the time, So these companies got together to provide those resources to support the war effort. And in the years following that, over the last 80 years or so, SBP's role has changed and evolved to the regional transmission organization that you see today.
Next slide. So I talked about a collaborative stakeholder process earlier. SBP has an independent board of directors that direct the activities. It is independent financially of any of the participants, any of our members, and we have an extensive committee structure where those 130 members get together and discuss the policies and procedures that SPP uses to provide all of those services, and they are the ones that really determine the direction that we use.
Also, I want to point out that we have a regional state committee, and that is made up of a member of each of the representatives from the state regulatory bodies from those 14 states, and they actually have primary authority over three areas. Those three areas are cost allocation, how new transmission costs get allocated to customers, how we approach regional resource adequacy, making sure there's enough energy and power available to serve the needs of the region, and allocating rights for those transmission lines.
so that regional state committee actually has primary authority over that in addition to our independent board of directors all right next slide so in 2021 SPP did a study on the value of transmission and I put the link there if you want to look at the details but it focuses on the transmission that particularly that was approved over a four-year period from 2015 to 2019 looked at the drivers behind that, including reliability, compliance, economics, and so on,
and determined that over a 40-year net present value look, that $3.5 billion or $3.3 billion worth of investment had a worth or a value to our customers and members of about $27 billion. And over the 40-year term, the revenue requirement or what it costs to build and maintain those assets was about $5 billion. So that works out to about a five-to-one benefit-to-cost ratio.
So there's a lot more in the report. I encourage you to go to the report there and look at the details to understand more about how we arrived at that value. Okay, now let's talk about regional transmission planning. On slide 10, so regional transmission planning is about finding a balance between expenditures and access to lowest cost energy. So we're always looking at those two things and trying to balance those.
A number of challenges that we have to face in that process include the fact that generators are often located quite some distance from the loads that they serve. So that means that transmission lines have to be built in order to bring that power, and that raises a number of concerns about siding. It is a relatively long process, sometimes very costly, to construct those new assets. Deciding who will pay is a key consideration,
and environmental constraints are also a consideration given the number of federal and state regulations that transmission owners have to navigate when they're considering new transmission assets so there are three basic considerations that SPP looks at when it's going through the process of developing plans for new transmission the first is reliability again keeping the lights on making sure that the SPP grid can provide service under all types of scenarios and situations is the first
and number one consideration. The second is economics, allowing customers, our members and rate payers to be able to access the cheapest generation that's available in the region is the second concern. And then public policy. Of those 14 states, they all have different policies regarding types of generation to be developed, types of transmission, who pays, and so on. So SBP's planning process has to take into consideration those public policy goals of those various players.
Next slide. So SBP has a process for conducting that study. We call it the Integrated Transmission Plan, and we start by considering a number of factors. Again, starting at the top, the number one thing is reliability. There's a number of standards that we ensure that the system is able to meet, And if we see that it's not going to be able to meet those standards, then we recommend upgrades in order to mitigate any problems. Public policy needs, operational needs, factor into that.
Economic needs, we talked about that. Generator impacts, as new generators come onto the system, the system has to be able to handle those new uses as well as new loads that want to come on. A big topic of conversation currently are new data centers, and that is certainly a big driver today, but we also see in SPP increases in oil and gas exploration that is driving the need for new transmission.
so all of those things come together. We determine what are the needs. We also look at various scenarios. What if generation doesn't pan out the way we think it's going to? What if there are fewer renewables and more gas plants? What if the price of gas goes up over the next 10 years? All of those things are factored into those needs, and we develop a portfolio that is able to meet all of those needs and be flexible to react to whatever situations come up so that
that results in an integrated transmission plan portfolio that is intended to meet the needs over a 10-year planning horizon and we go through this exercise every year on the next slide I'm going to talk a little bit about the transmission build cycle so SBP has a role and its transmission owners the utility companies also have a role SPP's role is that planning study process that we just talked about it can take from 12 to 18 months and then we go through a process once we have determined what upgrades are needed we go through a process to assign those to companies
to construct those upgrades and that's our transmission owner selection process and that can take anywhere from three to 12 months if it is if it is a project that is beyond a certain time horizon three years out or more it is a competitive project meaning that SPP goes through a process to award that to whoever can construct that at the at the least cost and with the highest quality so that can that can take longer and it can take as long as 12 months so that
that process can take three to 12 months in total then that hands it off to the transmission owner and the transmission owner is generally the utility company or it could be an independent transmission developer they're responsible for things like siding determining where a transmission line will actually be sited, the design of that line, the right-of-way acquisition, financing, and construction. SBB doesn't engage in those activities.
We just determine where those transmission assets are needed. Then we hand those off to the transmission owners who are responsible for siding and construction. And that entire process can be quite lengthy. It can be from three to nine years. The very large types of transmission lines and projects can take quite a long time to go through that entire process, as well as the construction process can be lengthy depending on a number of factors, including environmental concerns or processes, certifications that
have to be done. All right, next slide. We talked about the transmission owner selection process. This is for competitive projects, those that meet the threshold for eligibility. We compile a or put together an independent panel of experts. We invite companies to submit proposals to meet the needs that SPP has identified. They submit their proposals. SPP's independent panel evaluates those and provides a recommendation to our board,
which then selects an entity to construct those. This is a process that was mandated by the FERC under Order 1000, and SPP has its own process that meets those requirements under FERC and is intended, again, to provide competition to ensure that these large assets can be constructed at the lowest and most economical cost. So finally, takeaways I want to leave you with today. Transmission planning is complex.
It involves many different stakeholders that all have different and sometimes competing interests, and SBP's role is to balance those interests and try to meet everyone's need in the final portfolio. Reliability is our number one priority. Keeping the lights on is the main thing. but also and secondarily is reducing energy costs by enabling access to the cheapest resources and part of what we do is examine our portfolio and ensure that those can be affordable for
our members and their rate payers and ensuring that they are delivering the cheapest energy possible we also look at economic development that factors in to the selection process a lot of these the larger loads have economic impacts to their communities, and that factors in. And then finally, we leverage new technology, both we look at the generation side, what new technologies are coming along that would change the way we might develop our plans, as well as
new technology for the transmission system itself. So again, SPP's role is to facilitate the coordination of all of those various goals and interests. We do that with an independent board of directors, a rigorous study process, involvement of all of the various stakeholders that have an interest, including our state regulators, and a competitive process for those large projects. And so with that, I
Speaker 55
23:40
will stop and take any questions. Thank you for your testimony, Mr.
Representative John Maddox
Unverified
23:48
Purdy. We do have some questions. Representative Ladyman, you were recognized for
Representative Jack Ladyman
Unverified
23:56
a question. Thank you, Mr. Chairman. I'm over here. Got a couple questions, but if I get to four, I'll put me back in the queue. But how much of Arkansas does Southwest Power Pool provide? I mean, the map showed, you know, Northwest. What percent do you
Representative Jim Wooten
Unverified
24:18
say you provide? I don't know the percentage, but our members in Arkansas are Swepco, Oklahoma Gas and Electric, Empire District Electric, Arkansas Electric Cooperative.
I believe that's all of the members. There are a number of customers in Arkansas, such as the city of Clarksville, the
Speaker 55
24:36
city of Bentonville, that take service from SPP through one
Representative Jack Ladyman
Unverified
24:41
of those members. So MISO is the other provider of
most of Arkansas. So how would this proposal or this ISP, in your opinion, how would that affect what MISO does? I mean, does that affect them or does it
Representative Jim Wooten
Unverified
24:56
just affect you? So MISO is also a regional transmission organization like SPP,
and it does provide the same types of services that SPP does. Their members include Intergy, which is the largest provider in Arkansas, as well as a number of other smaller entities. i don't i don't know that we have a position or an opinion on the the proposal itself i just wanted to provide information to help you make an informed decision and as a note my so was invited to be here
Representative Dwight Tosh
Unverified
25:25
today they couldn't get they couldn't have someone here
Speaker 39
25:28
today but they are willing to come to a future meeting to answer any questions like that about this kind of stuff thank you
Representative Jack Ladyman
Unverified
25:36
uh so does southwest power pool own any of the lines or are these all
Speaker 71
25:41
owned by other entities Southwest Power Pool does not own any
Representative Jim Wooten
Unverified
25:46
lines or generating stations. They're all owned by those utility companies like Swepco, OG&E. Those are the actual owners and operators of those
Representative Jack Ladyman
Unverified
25:55
facilities. Are there any private companies that own these lines like Kinder Morgan is a gas supplying company that owns lines? Are there any companies like that that really aren't the producers or the retail like Intergy?
Representative Jim Wooten
Unverified
26:09
So SPP does have some independent transmission companies that own transmission. It's not limited to utility companies. It can be anyone that meets our membership requirements and pays the membership fee and puts those assets under SPP's control. But generally, those are large utility companies with only a couple of independent entities. Okay. So is
Representative Jack Ladyman
Unverified
26:34
SPP, are you a private entity? Are you a government entity? How has your board
Representative Jim Wooten
Unverified
26:41
chosen? How does that work? Yeah. SPP is a private company. It's a non-profit entity. It's a membership-based, so it's a voluntary organization. It's not a federal or state creation. Our members voluntarily come to SPP and join and put their assets under SPP's functional control, or SPP's job is to determine who has access to the high-voltage transmission system. That's what functional control means, but it is voluntary.
Our board is selected by the membership, but they have to, in order to satisfy the federal requirements, they have to be independent of any of our members or customers, so they can have no financial interest in any of the utility
Speaker 76
27:30
companies or independent entities or anything like that that do business
Representative Jack Ladyman
Unverified
27:35
in SPP. Okay, one more question. In your opinion, how does this compact that's proposed in this ISP, in your opinion,
I mean, how does that help?
What does that do to help us in Arkansas keep the lights on?
Representative Jim Wooten
Unverified
27:53
How does that help us? Yeah, again, I don't know that SPP has a position on that. As I read it, it looked like it was another layer to developing transmission and planning transmission. SBP has, as we talked about, a number of processes that we use to develop transmission within our area.
And we also coordinate with other areas. So we coordinate with MISO, for example, in developing projects. So to me, it looked like another avenue for doing that. Thank you. Thank you, Mr. Chair.
Representative John Maddox
Unverified
28:27
Thank you. Representative Eubanks, you're recognized for a question. Thank you, Mr.
Representative Jon S. Eubanks
Unverified
28:34
Chair. I think you just answered my question. I was MISO and SPP cover all of Arkansas. Is that correct? That is correct. Okay, so I guess my question was, is there any coordination between the two
so that we're making sure that all the needs of the whole state are being met? And so do you guys work in coordination and make sure that happens? And is their organization the same as set up as SPP? I'll take
Representative Jim Wooten
Unverified
29:05
the second question first. So it is MISO, as I understand it, and I'm not here to speak for MISO, but as I understand MISO's organization, it is very similar. They are also mandated by FERC to have an independent board.
Their makeup is a little bit different, and they determine things a little bit different. Their involvement of regulators is a little bit different in MISO than it is in SPP, but it's largely the same. And in terms of coordination, we do have formal processes that we engage with MISO and all of our neighbors, not just MISO, to coordinate our planning activities to ensure that we are not causing problems for MISO, and MISO is not causing problems for SPP, and that when we do engage in joint projects,
Speaker 85
29:53
that those are beneficial to both sides. Follow-up? So I
Speaker 86
29:59
guess, you know, I think there's a lot of concern that we may not
Representative Jon S. Eubanks
Unverified
30:05
be planning for the future, and especially with you brought up the data centers and the needs, the power needs we're going to need going forward. I think there's a lot of people that are worried that possibly we're not – maybe we need to do things maybe to streamline the process so that we can maybe put some of these transmission lines in place or build new generating plants.
And I don't know if that would fall under your purview or not, but maybe that's the PSC. But, you know, we just want to make sure that we're planning for the future and being able
Representative Jim Wooten
Unverified
30:46
to be flexible enough to move quickly. Right. So in terms of plants, SPP, again, does not own any plants. We don't also don't determine what new plants will be built. We do determine that for transmission, but not for generation. Our members are in charge of doing that for themselves.
SPP, as we talked about, has a quite involved planning process. One of the things that we strive to do is to look out 10, I said our plan is for 10 years. We actually look 20 years into the future. We look at things like trends in data centers, but not just that, general electrification. We've engaged with consultants to do studies to determine how things are going to play out over the next 10 to 20 years. And then also looking at new types of generation, what trends are playing out, what political considerations are playing out.
And we try to plan the system so that it is flexible enough to meet all of those various scenarios should they come into fruition. But it's a balancing act, and it's one that we are continually doing. So every year we're going through this same exercise and looking at what did we plan last year? Does it still make sense or have things changed and do we need to pivot and go a different direction?
Chair
Unverified
32:11
Thank you. Thank you, Mr. Chair. Senator Flowers, you recognize for a question.
Senator Stephanie Flowers
Unverified
32:16
Thank you. Thank you. I'm trying to understand this whole process as the pool. And you mentioned all these rules and regulations, policies that have to be considered and complied with. And I'm just trying
to figure out, okay, you have state, public utilities commission or public services commission.
And then you have FERC, and then you have your individual members, and so you say SWP, SPP, you
all coordinate what I was hearing, the generation of and the transmission of energy. am i
Representative Jim Wooten
Unverified
33:19
is that correct sbp coordinates the transmission part basically we our members
determine what generators they're going to be on the system we don't directly influence that they tell us where those generators are going
Speaker 100
33:33
to be your members our members yes and the utility companies and and customers yes
Senator Stephanie Flowers
Unverified
33:41
so do your your members have to first get approval and permits from FERC? For transmission? Yes, and from the different
Representative Jim Wooten
Unverified
33:53
states. So generally how it works is SPP issues a directive to our member
to construct a certain asset. Then SPP directs our member to construct a new line, for example. Then that member, that utility company, SWEPCO or OG&E, then they go through the process of getting whatever certificates are needed from the state in order to bill that, and they're in charge of acquiring the right-of-way and paying for any right-of-way that they need to acquire in order to construct that asset.
Senator Stephanie Flowers
Unverified
34:31
That's their responsibility to satisfy those state requirements. Where does FERC come in? At the beginning
Representative Jim Wooten
Unverified
34:41
of this or just throughout? So FERC, well, it's all over, really, but it plays out in the planning process in that FERC requires that the planning process follow certain procedures. It has to satisfy certain goals. It also has to meet certain standards like the North American Electric Reliability Council standards that say what kind of scenarios the transmission system has to be able to withstand.
Speaker 107
35:10
So that's directed to the members? That's directed to SPP
Senator Stephanie Flowers
Unverified
35:17
and the members, but primarily SPP. Because the members are going to bring
it to SPP, so it seems like they would have to have some
idea of what's required by FERC
Representative Jim Wooten
Unverified
35:30
before they can even present something. They do, and they participate in our committees and processes to determine what the best types of, they determine the study scope, how the study is
done, as well as they contribute to determining what types of upgrades would be determined through that process. And
Senator Stephanie Flowers
Unverified
35:53
approval would be after this committee has determined where to put the transmission lines is the state or does that come before
Representative Jim Wooten
Unverified
36:09
well the state has ultimate authority over what gets built in
Speaker 55
36:13
in the state and so they're they would have to approve or
certify certify whatever is uh built by the transmission owner yes and whatever is
Senator Stephanie Flowers
Unverified
36:24
approved by spp yes well if spp
Representative Jim Wooten
Unverified
36:29
issues that directive if the state does not agree with that then spp might have to review its plan and come up with another alternative okay and
Senator Stephanie Flowers
Unverified
36:41
there is something i saw in your presentation in
my handout it's on it's like page 13 the use of uh this phrase spp
tariff uh transmission facilities that meet criteria in the spp tariff and are approved for construction known as competitive upgrades can you ex give me more on
that what is what are you talking about here so the tariff refers to
Representative Jim Wooten
Unverified
37:20
the tariff that is filed with ferk so it is the the The document that explains the processes, the study processes that we go through, what's required for customers to gain access.
It's the tariff. How much money it's
Speaker 114
37:35
going to cost a customer? Is that what
Representative Jim Wooten
Unverified
37:37
you're talking about? No, the processes that SBP uses to determine what upgrades should
Senator Stephanie Flowers
Unverified
37:43
be built. So, I mean, it sounds like a
Representative Jim Wooten
Unverified
37:48
different understanding of the word tariff. It is different. At the state level, generally, that's how much you'd pay, dollar per megawatt, how much a retail customer would pay. And there is a component to that in SBP's tariff, but it's primarily about the process.
A tariff process? Yes. So the tariff determines how SBP goes about doing its functions. It also lays out how SBP will collect revenue from its customers and give those back to them to operate their transmission system. So
Speaker 55
38:24
it's only about the operation of the transmission system. It sounds more like
Senator Stephanie Flowers
Unverified
38:29
it's about money, too, what you just said. There
Senator Stephanie Flowers
Unverified
38:36
But it all has to be approved by at least the state. And your tariff process, is that approved by FERC? It is, yes. And by the state? It is not approved by the state, no. So because it's approved by
Speaker 55
39:01
the Fed, FERC, it doesn't matter whether it's approved by the state or not. Is that what you're saying? It is a federal tariff that SPP files with FERC, and it meets those requirements that FERC sets out for transmission planning and transmission access.
Representative John Maddox
Unverified
39:14
Senator Flowers, I hate to interrupt you, but could we? No problem. Okay. We have numerous people in the queue, so if you could get back in the queue, I'd appreciate that. Thank you, Senator.
Representative Dwight Tosh
Unverified
39:29
Representative Tosh, you were recognized for a question. Thank you, Mr. Chair. I'm just curious, has this type of legislation or similar legislation, has it been introduced in other states? And if so, was that legislation adopted or was it rejected or what was the outcome if it was introduced?
So from my knowledge, I was the first just to get the conversation started. They were having
Speaker 39
39:53
conversations in the other states where this legislation was, that are named. I forget them off the top of my head. But those conversations happen, and a lot of that had to do with, you know, each of them do different things. Like, Louisiana is a different structure than what we have, and so how this kind of stuff would come along may be different. And, again, like, we can go ahead and do the study on this, and I think we should,
but the bigger piece to this is, like, we need to have a conversation about how we're going to ensure that we have good transmission line policy in the state. That's the bigger picture here. Like, the compact could be the way, it may not be the way, but we need to be sure that we know that we have the best transmission policy in the nation, as far as I'm concerned. Senator Irvin, you're right now for a question. Thank you, Mr. Chair.
Senator Missy Irvin
Unverified
40:48
So, how does this compact, as proposed, interact with the PSC in the
Speaker 133
41:03
state of Arkansas? So I can largely speak on what the PSC does currently with regard to transmission. I think besides interacting with the PSC in an informational component, I don't interpret this compact to in any way impact the authority or jurisdiction
Speaker 134
41:24
or charter of the PSC.
But that's just my understanding of it. I don't want to speak on behalf of
Speaker 135
41:35
it if I'm wrong on that. So, again, I'm sorry. Are you with Southwest Power Pool? I apologize. No, I'm Danny Hofer, Chief of
Senator Missy Irvin
Unverified
41:43
Staff at the PSC. Okay. I just wanted to make sure I got that clear. That's what I thought. But I'm getting confused as to who's with whom. Okay. So I guess a little bit like what Senator Flowers was talking about, the money. I'm trying to understand what the protection is for the people that are paying the rates
and how does that factor in to the tariff that you are describing in response to Senator Flowers' questions. How are those regulated if you adopted this compact? Because I think we're here to talk about the compact idea, correct? i mean i understand your proposal that you've given given us a presentation but are you here in support of this legislation or not in support of it if so give me the pros
if not give me the cons i
Speaker 44
42:41
would say two things um like we also like so we only have one representative
Speaker 39
42:47
here from spp um we have another representative from beckert um and another the representative we have, of course, from the Public Service Commission, and then this is the vice president of EPL Advisors. They all also have something they would like to say in their own right, separate from SPP. And we've already adopted the ISP before this. So now we're just kind of discussing, yeah, this proposal,
but also I think the bigger conversation of us having and focusing on transmission. Because it's going to be, if we did something today, it could be up to nine years before
Senator Missy Irvin
Unverified
43:21
we could get lines built. Yeah, so I understand why you want to have the conversation. I'm just looking at the legislation that's been proposed through the ISP, which I think was presented during the session, correct? Yes, yes, ma'am. And so what SPP has presented to me sounds very similar to what this is. And so I guess I just need to know, you know, would this be duplicative of what's already in existence with SPP
and the other MISO, or is this a bureaucratic, more of a bureaucratic approach to putting into concrete of what's currently happening? I'm just trying to understand this thought process because what was presented seems to me what's already happening within your legislation as a compact. There's kind of already a compact going on with the members of Southwest Power Pool.
You're already operating in that way. The issue for the state of Arkansas, though, is you have this, but then you also have another pretty large presence there with the other entity. If somebody can explain the lay of the land there for me, that would be really helpful. Hey, good morning. My name is
Brent Bailey
Unverified
44:42
Brent Bailey, and I know I'll be sharing some comments here soon.
It certainly brings up some good points about the process going forward and certainly avoid creating a new bureaucratic level of oversight. The ultimate point is to bring more opportunity, to bring visibility to the process. I know just by the questions I've heard coming from this body this morning, it does get complex and it's a challenge to understand where the state fits in this, where the federal fits in this, and where your regional planning organization such as SPP or MISO fits in this.
And that's what we hope by the compact is to bring more clarity, more understanding, and more visibility to members of the legislative, particularly to help coordinate cross-state construction of these type of lines so that when you're building a high-voltage transmission line and you're going across state lines, the project does not stop because there's inequality in how standards or how permitting, siting, and certification occurs. as we look at what are the long-term goals and strategies for economic development,
for reliability and resiliency within our transmission network, not just in Arkansas but across the region, and particularly for the long-term benefit of Arkansas as well. So I hope that kind of answers where we're going on that. Sure, tariffs play a role in dollars, but this is certainly to create a more informed decision-making body within the legislature and other legislatures across the region to ensure we have some type of uniform and standardization
Chair
Unverified
46:22
in permitting a siting. Okay, that helps a little bit. Thank you. I'll make
Representative Richard McGrew
Unverified
46:32
it back in the line. Representative McGrew, you're
recognized for a question. Thank you, Chairman. I've got a couple of questions. One is, and I appreciate your explanation of the Southwest Power Pool and what you do and it sounds like you y'all do a great job of coordinating between all the members and all and going to the future i have a concern that the growth that we're having i know the growth that
we're having now is tremendously more than what we had in the past much faster much quicker and at higher incline so is the system you got the way you're working if it takes three to eight years eight years to put infrastructure in place is that going to be quick enough are we going to be in trouble or do we need to change something in that the other thing is I don't know that I understand it's what the compact is doing seems like you're already doing this planning and all is someone going to explain the compact and
what it does or where we going
Speaker 39
47:34
from there I mean I think I think broadly what this would do is it would ensure that the four states listed in the compact would be having similar permitting structures to ensure that we can build transmission lines as quickly as possible so that we can meet the needs of the region.
Representative Richard McGrew
Unverified
47:56
And that's part of the answer, but when the government gets involved and starts doing this, generally we drive the cost up. In some ways, maybe we need to get out of the way so that they can work
together. Is that what this does, or does it make it more complicated? That's a great point.
Speaker 39
48:11
I mean, we're already out of the way, and it's already taking eight or nine years. So I would be -- I guess my point would be ensuring that we all can look at each other in the face and ensuring that we're doing all that we can to make sure our policies
are friendly for transmission, high-voltage transmission lines across the state. And again, I have two other -- well, I guess three other members who have presentations that they'd like to speak on this, so maybe we can get more information from
Chair
Unverified
48:43
them. Representative Vladyman, you're right now for a question. Thank you, Mr. Chair. I just got
Representative Jack Ladyman
Unverified
48:47
two brief questions. I'll try to be brief and let the other presenters go, but Mr. Prudik, so I'm just trying to understand based on what the question's been asked.
So as far as regulation, Southwest Power Pool, I mean, who is your main regulator? FERC? Is that the main regulations that you look at to operate your business or your entity?
Representative Jim Wooten
Unverified
49:12
So primarily FERC, but we are regulated by the states that we operate in as well. Well,
Representative Jack Ladyman
Unverified
49:20
that was my second question. At the state level, say in Arkansas, what are the primary regulations there? I mean, is that regulations that are in our Department of Energy or for environmental and that sort of thing?
Is that who you look to at the state level? the regulations
Representative Jim Wooten
Unverified
49:38
that affect you and I'm not familiar with that that part of it but I'm more familiar with the federal part but the Public Service Commission we we have in our committees we have public service commissions of all the states that participate in looking at SBP's processes and cost allocation and so on and they have input into that the specific rules and regulations are in the
individual state laws and PSE regulations for that individual state. Okay one more question and this may
Representative Jack Ladyman
Unverified
50:12
be for Danny this may be for you at PSE but I'm a little fuzzy on Southwest Power Pool will come up with a need in a region or an area and they'll put that out but the people that are to build the power supply plants the power generators how would that be chosen you may
be able to answer this better so if if power pool says hey we need 700 megawatts in northeast arkansas and you have the corridor there where you need it then how would that provider of a power plant be chosen or would they come to you how would that process happen normally is that a question you can't answer i'm if it's not that's okay i mean i can
Speaker 134
51:03
offer to you that they do not come to the psc for that i i can't tell you who um they go to if that's something they go through spp um
i i can just i can go into like the full what the psc does in that but if you just want a quick answer um yeah if there's just a specific area determined to build transmission in the psc is not involved in that if there is a specific
Speaker 160
51:30
facility proposed um it may come to the psc there's there's definitely some nuance within that all right
Representative Jim Wooten
Unverified
51:41
to that sbp has uh rules regarding resource adequacy for our members so they have to uh they
have to have enough generation to cover their load plus an additional amount, and that's where SPP's requirement stops. We don't tell them how to satisfy that need or what plants to build. They decide that, and then once they've decided that, they come to SPP and say, what is this going to do to the transmission system if we put this plant here and we do an analysis? and then they go to the state and obtain the certifications and permits necessary
and get approval from the
Representative Jack Ladyman
Unverified
52:22
their rate base. So your affected member is involved in that?
Yes. Okay. I'll let the other presenters present then. Thank you.
Senator Stephanie Flowers
Unverified
52:34
Senator Flowers, right now for a question. Thank you. I guess this
is for the sponsor. I'm trying to understand this. You want Arkansas to enter into a compact agreement with Mississippi, Louisiana, Texas.
Speaker 39
52:52
That's it. That's it? Yes, ma'am. Where did you get this idea? That's a great question. So I spoke with a couple of individuals who they brought this legislation
Senator Stephanie Flowers
Unverified
53:09
forward to me. I mean, who are these individuals? Are they from the energy?
Speaker 163
53:14
I mean, just to be frank, he was a lobbyist from the community, and he
Speaker 39
53:19
showed this to me. I was like, this seems like a great idea to lower transmission costs
if we can have conversations. I think one thing that's interesting is we went back to one of the other slides that showed, like, what SPP has, what MISO has. Like, there's a lot of, and there's other RTOs, I
Senator Stephanie Flowers
Unverified
53:39
believe, like ERCOTs. Yeah, like the Electric
Speaker 39
53:42
Reliability Council of Texas. Yeah, ERCOT. So, like, we've got multiple different transmission operators existing in those four states. I'm
Senator Stephanie Flowers
Unverified
53:50
just trying to understand where this idea came from and what, the people that brought it to you, you
say they think it'll be able to lower our rates.
Speaker 39
54:03
How? Well, I would let Mr. Bailey talk about that. You don't know? Well, he was a public service commissioner in Mississippi. Yeah, but you brought it. You brought this. Senator Flowers, I'm not an expert, I have to be honest. I see a good idea. I think it's a good idea, and I learn, and we go with the process. And I'm
Senator Stephanie Flowers
Unverified
54:23
glad we're discussing it so we can all learn about it. And all I'm asking is why do you think you
Speaker 39
54:29
think this is a good idea? Because I think if we did not have as many different entities having to argue, different states arguing, different RTOs arguing about how they want something done, it's just a single process.
This is how we're going to do the thing to get an electric line from Arkansas to Texas. Then it seems like it's going to be a lot easier to run
Senator Stephanie Flowers
Unverified
54:50
that line so that we can meet the needs of our citizens. As I recall, Texas has been having a whole lot of
problems with transmission. So why would we get into a compact with a state that's got
Speaker 39
55:03
more issues in that regard than we do? Well, we're all interconnected. ERCOT is a different RTO than SPP and MISO, and they're in very different parts of the nation.
And so if we have those kinds of conversations of lines running between different entities, we can continue to help each other out. When I looked at SPP a few weeks ago, I mean, they just showed their map of what they, where was it at, on slide four. But they have connectivity all the way to the west coast in Washington and Oklahoma that they can get electricity from if they need it. When it's, let's say it's lights down here, but they've still got solar on the west coast and we have wind in the center part of America,
we can run and run that market and ensure that everyone has electricity. So having a wide variety, not just of resources, but different areas of the country that can produce that electricity is going to be better for Arkansas, is going to be better for the other states as well, and better for the region. Me and Fort Smith, I mean, I know Oklahoma's not on this, not in the compact, but I'm an SPP guy. I think our electricity is produced about 30 minutes west of me in Oklahoma, south of Spiro is, I think, where a lot of the power production is there. And so, you know, this legislation, I'm not even sure if it would help me particularly, because Oklahoma is not involved in this.
But I would want, if Arkansas had high need for electricity, Fort Smith specifically, that there would be easy transmission line policies between the two states so I can ensure that I can get the jobs and the electricity in my
Senator Stephanie Flowers
Unverified
56:37
area. Well, did Fort Smith have an option to maybe join MISO?
Speaker 39
56:46
Well, so that's actually interesting. So SPP is here in Little Rock, but SPP isn't powered by SPP.
The Southwestern Power Pool headquarters is not powered by the Southwestern Power Pool. And that was the decision on the utility company because they wanted a different way to, I guess, be regulated. And so that power company moved to MISO. But SPP had already built the stuff. They're here, and they want to be here. They had already built the stuff. Well, their headquarters. You mean
Senator Stephanie Flowers
Unverified
57:15
the transmission? No, their headquarters. They weren't
Speaker 39
57:17
going to move their headquarters that they had just built because the energy company decided to move. So it's
Senator Stephanie Flowers
Unverified
57:23
more about what's in the best interest of the company, sounds like, than what's in the best interest of the rate payer.
I don't know about that, man. Picking and choosing what pool you want to go to, or what do you call this, the RTO? Is that what you call this whole thing? That's a
Speaker 163
57:42
transmission operator. Senator Flowers. Well, I'm just
Representative John Maddox
Unverified
57:45
trying to. Thank you. If you could. Thank you. Representative Wooten, you're recognized for a question.
Representative Jim Wooten
Unverified
57:53
Thank you, Mr. Chairman. I guess this question is for Mr. Purdy.
Are we adding another layer of someone for you to have to go through in order to be able to achieve your – I
mean, I'll just cut through it. Is that what we're doing? Representative, I don't know that I would look at it that way. We coordinate with multiple different layers of stakeholders and regulators and state entities.
And if this were to come to pass, it would be another of those that we would coordinate in our study process and our
Speaker 55
58:44
development process. We would work with whatever we needed to work with in order
Representative Jim Wooten
Unverified
58:50
to develop transmission. That's a very good bureaucratic answer. What I'm asking is, do you see this as another layer that you have to work through in order to be able to achieve the three- to nine-year building process?
It's an additional consideration that we would have
to. Representative, I would say this, though. Well, the reason I ask the question is because I've heard FERC, I've heard members, I've heard states, I've heard other entities, and now we're adding another entity. And another question I have, Mr. Chairman, if I may, is of the six on takeaways, of the six that you have listed, enabling economic development is the fifth one.
Are they in order of priority that you all see them, or are they just there? That wasn't intended to
Speaker 66
59:51
indicate a priority, except that I will say that reliability is the number one priority. So you see economic development from
Representative Jim Wooten
Unverified
1:00:00
the Southwest Power Pool as being fifth in priority. Is that what you're saying? No, sir. No, that's not what I said. I said they're not in order of priority.
Oh, they're not in order of priority. No, not in order of priority. We see reliability as job one, but those other considerations are also important. It's just that if the lights don't stay on, then you don't have
any economic ability to... One more question. Let me be sure. Are you the final say in whether a transmission line is built within interstate or interstate?
Representative Jim Wooten
Unverified
1:00:52
Is SPP the final authority? SPP determines What type of infrastructure is needed, but we don't necessarily determine specifically whether a particular line is constructed in a particular location and if a if a company Declines to construct for whatever reason SPP would come up
Representative Jim Wooten
Unverified
1:01:17
Okay. One more question. This is another one. Do you find yourself in a position of, let's say, you know, we started with Jones Mill in 1941, and that was economic development, if I'm correct, down there for that aluminum plant. Well, it was for the war effort, actually. Okay. Okay. Water. All right. Ben, do you find yourself at times choosing between states
that are competing for the same facility, economic development? Generally,
no. SBP takes whatever our members tell us they need. So if they tell us I need a new plant or a new load in this location, then SBP takes that need into our planning processes. So we depend on our members to tell us their needs and what they need to satisfy those.
Thank you very much. Thank you, Mr.
Speaker 39
1:02:26
Chairman. I would say one thing when we talk about the layers. If someone's coming to build a line through Arkansas and through Texas, that's two layers. If we have similar policies, then that two layers just becomes one layer and it's easier because they're consistent. That would be my argument for this whole thing. it's not multiple different layers it's one layer and with that i would like to have my next person this is a representative from beckert corporation i believe you have it if you would go ahead and
Representative John Maddox
Unverified
1:02:59
introduce yourself again for the record and present
Speaker 184
1:03:03
your testimony please thank you i'm daniel berkowitz with beckert corporation uh steve thank you for your time and representative
Speaker 186
1:03:10
Graham Lynch thank you for having me here today good morning I again I'm Dan Dan Berkowitz mechanical engineer from Bekaert so I want to kind of talk about the critical opportunity for the Arkansas grid and how advanced conductor technologies can deliver fair efficient and future ready transmission solutions so really focus on how using technology can reduce the costs for the ratepayers
This is our factory in Van Buren, Arkansas, where we manufacture the steel wire strand. We sit next to the Arkansas River on Interstate 40 at the Arkansas-Oklahoma border. We have access to barges coming from Mississippi River, rail, and truck. And so we get our steel rod from Mills and take that rod, clean it, prepare it, and transform it using a process called pickling, among others. We draw it to the correct diameter and then put it through a zinc and sometimes zinc aluminum bath. And finally, we take that wire and strand it together into seven wire strands that's used in overhead power lines.
I have a couple samples here for those that want to come check them out afterwards. So I kind of just want to dive into the current state of the Arkansas grid first, explore how we can modernize it with smarter, faster, and more cost-effective approaches. So Arkansas transmission infrastructure is aging. According to the Department of Energy, 70 percent of the U.S. grid is over 25 years old. That's just not a stat. It's a challenge to reliability, efficiency, and capacity.
MISO's December 2024 forecast projected a 53 percent increase in long-term electricity demand. So that's a huge load increase, and Arkansas must be ready for that. But to talk a little bit more about that, Arkansas lost about 3.5% of its energy in transmission and distributions. That's energy loss that's not being used, just dissipates to the atmosphere. That's according to the Energy Information Administration.
The good thing about that, it's lower than the nation's average of about 5%, but 3.5% is still large. Electricity losses occur between the point of generation and delivery to the customer. This loss occurs due to inherent resistance in electric conductors, as well as other factors such as inductance and capacitance in the electric grid power lines. The loss of energy is typically manifest as heat, reducing the overall efficiency of the electrical energy transmission. Line losses contribute to inefficiencies in the energy system and lead to higher electricity
costs for consumers, as utilities must compensate for these losses when setting electricity rates in the wholesale energy market. So I'll do a quick calculation. At a rate of about 9.73 cents per kilowatt hour, that's over $100 million in losses per year. Utilities do not bear the cost, the rate payers do. This is where the line loss matters. Over the average conductor lifespan of about 50 years, this number jumps to $5.2 billion in energy loss that nobody uses.
So percentages matter. Remember that, as we discussed in a few slides. So calculating the power loss distribution in electrical systems is complicated unless you're an electrical engineer. For those types, the formula is power loss is your I squared R. And for the rest of us, it's just the electric current squared multiplied by the resistance of the conductors. That equals your total loss. So reducing the current is the best solution, followed by the resistance, and this can significantly reduce our losses.
So let's keep that in mind as we explore further. We want to reduce that current. So let's talk about the options that we have in upgrading the Arkansas grid. So the first one is the new build. So that's building a brand-new transmission line. It's a high initial cost, long lead times, as we've been discussing, three to nine years, as Steve said, but it is pretty future-proof. Rebuild is medium cost. It typically takes three to four years.
We can almost double the capacity or more in that scenario. And then finally, reconductoring. This is low cost and really fast, typically one to two years, and we can up to double the capacity using the existing structure, so we don't have to take down any towers. So reconductoring really is the sweet spot. It's minimal disruption, faster deployment, and significant capacity gains. So let's talk about the tools we have.
This is a tools-in-a-toolbox approach, so make sure that we want to pick the right tool for the right application. There are several conductor types, each with unique properties. The ACSR, which is your aluminum conductor steel reinforced, is a traditional round wire over steel. It's reliable. That's what the Arkansas grid has been built with since the grid's inception in the early 1900s, but it's got limited capacity and efficiency. The next technology is the ACSS, which is the aluminum conductor steel supported.
In this technology, we use annealed aluminum, which improves conductivity and allows higher operating temperatures. The aluminum in this type does not help with structural performance anymore, and the steel bears the structural load. And then we have also an ACSS-TW. We actually changed the geometry from round wire to a trapezoidal wire. And this design packs more aluminum into the same diameter, boosting capacity. This conductor right here is the best solution
from a total cost of ownership perspective, not to mention that we can make it here in Arkansas. And then finally, there's, for other niche areas, we have a plastic composite carbon fiber core that uses trapezoid aluminum. It has a high first cost, typically three to four times the cost of ACSR, and some beneficial characteristics like high temperature sag reduction. So these technologies aren't just theoretical. They're proven.
They allow us to upgrade without rebuilding, and they're compatible with the existing infrastructure. So kind of talk about the quantifying the impact of each of these technologies. So utilizing the trapezoidal wire, we can increase the efficiency by 20 percent and increase the capacity by 10 percent. Higher operating temperatures, so using this annealed aluminum, can boost the capacity up to 80 percent. Although if you look at it from an efficiency perspective, it drops as you increase the temperature of a conductor.
The ability to run hotter is also a great tool in your back pocket because during peak demands, you can run the conductor a bit hotter to get the load that you need at the capacity. So essentially larger conductors and stronger cores allow more aluminum, improving both efficiency and capacity. The annealed aluminum alone can improve conductivity by 1% to 1.5% with minimal cost increase. These changes are scalable and cost-effective.
Most add less than 10% to conductor cost, yet can deliver double-digit performance gains. This slide kind of backs it up. This is a study from Idaho National Laboratory, part of the Department of Energy. It's called the Advanced Conductor Scan Report. It is continually being updated, so the most recent revision is like 12 right now, revision 12. So I highlighted in blue below, at the bottom of this table here, the ACSS-TW-MA5
conductor offers the highest capacity improvement of any commercially available conductor on the market today. So in a reconductor scenario, you could take down the old line and put up this new conductor that's manufactured and more than double the capacity on the same line. for a modest 52% cost increase compared to the traditional conductor. So even if you look at some of the other options in there, even the basic ACSS round wire conductor can deliver a 174% capacity increase
just for a minor 8% of the cost of the incumbent conductor that's up there. So these are not marginal improvements. They're transformational. They're already in use across the country. I've included case study references to these successes in the appendix of this presentation. There's quite a few of them, so I won't go into each one of them, but they're there for your reference. Looking at the economics of using these advanced conductors,
according to this is analysis used from MISO's cost estimation guide, we compared two conductors. So we have the ACSS trap wire Suwan-E conductor, can deliver $2,150 per 1,000 feet, delivering over 2,000 amps. It's only $2,000, $2,150 per 1,000 feet. And alternatively, there's other types of materials out there that use the carbon fiber.
They're typically three times the cost and can't meet the capacity. So the advanced steel core conductors that are manufactured in Van Buren, Arkansas, on an economics perspective, typically deliver what is needed for the Arkansas rate payers, and that's the reduction in cost to their utility bills. The Suwannee conductor delivers more amps at less than half the cost per amp, And it's the compelling case, like I mentioned, as far as upgrading the Arkansas grid.
At Beckart, we're committed to accelerating innovation that delivers more capacity, reliability, resiliency, and affordability to the U.S. grid and Arkansas grid. We want to be part of the conversation, whether it's reconductoring, grid-enhancing technologies, or network upgrade challenges. I have some references here. We've published white papers and partnered with utilities nationwide. The data is clear. The advanced steel core conductors that are made in Van Buren are the fastest and most cost-effective way to modernize your grid.
We'd like to work together with you to deploy these solutions. And thank you for your time. Look forward to discussing how we can support your transmission
Chair
Unverified
1:14:20
goals. Thank you for your testimony. We do have a question, Representative Leitman. You're recognized. Thank you, Mr. Chairman.
Representative Jack Ladyman
Unverified
1:14:27
Thank you for that presentation. That's very interesting. And I didn't realize it was made in Arkansas. I'm a little familiar with that. But so have can you give us an idea of have you done replacement or provided this type of wire for replacement in large projects in our state or in other states as far as replacing the lines? Have you all done some of that?
Speaker 186
1:14:50
Yeah, Entergy has used some of our ACSS conductors. Typically, 95% of the U.S. grid is outfitted with the steel core conductors, and the majority of that's coming from Van Buren. We're promoting the use of that more often to show
Speaker 188
1:15:06
that it's a way to reduce the cost to the ratepayers. Okay. I'd like to
Representative Jack Ladyman
Unverified
1:15:13
ask Southwest Power Pool a question about your wire.
the y'all or who would look at if you needed more capacity in an area who
would would you look at the wire versus a new line I mean who makes who looks at that how's that
Speaker 119
1:15:34
decision made can you kind of add to that
Representative Jim Wooten
Unverified
1:15:38
so in SPP's planning process when we identify a need a constraint you know a line that's limited or an area that needs additional power we identify that as a need and And then we request customers or members or anyone that wants to to submit proposals for how that need might be met.
And so they might submit a reconductor of an existing line. They might submit, you know, a suggestion that involves a newer conductor like this. Or they might suggest something else as a conventional replacement. And then SPP will evaluate those and determine which one is the most effective, which one has the best economic return value associated with it, and then select based on those inputs.
Representative John Maddox
Unverified
1:16:29
All right. Thank you. Thank you. No more questions. So moving, I guess, to the next witness, Ms. Hofer, if you'd introduce yourself
Speaker 46
1:16:41
and present your testimony. Thank you, Mr. Chair. Danny Hofer, Chief of Staff at the PSC. The PSC
Speaker 135
1:16:46
is here in an informational capacity, so we're not here in any kind of advocacy role, either for or against the compact. We're really just here to provide information on our involvement, the role that we play in transmission.
So the commission plays two main roles with regard to transmission. The first, the commission has some citing authority for new or replacement transmission, though not over all transmission facilities. those transmission facilities that fall under
Speaker 133
1:17:17
commission jurisdiction for this purpose are required to file an application with the commission seeking a certificate of public convenience
Speaker 135
1:17:24
or in necessity sorry we speak an acronym so we call it a ccpn but its full name is a certificate of
Speaker 46
1:17:33
public convenience and necessity this applies to facilities defined as major utility facilities under 2318-503, and
Speaker 133
1:17:43
this would include, for the sole purpose of requiring an environmental impact statement under this subchapter, an electric transmission line and associated facilities, including substations of, so here's the facilities that actually fall under PSC jurisdiction, where
Speaker 135
1:17:59
a utility would have to come in and ask the PSC to go ahead and
construct this it would be a or to get
Speaker 133
1:18:10
a cecpn at least it would be a design voltage of 100 kv or more and extending a distance of more than 10 miles or a design voltage of 170 kv or more and extending a distance of more than one mile a transmission facility owned in excess of 50 percent by a wholesale generator does not fall under PSC jurisdiction with regard to citing
approval. And the PSC does not have jurisdiction for transmission planning. The second role that the commission plays in transmission is our participation in the RTO stakeholder process. So the commissioners and our staff both actively participate in both of Arkansas's RTOs. That would be Southwest Power Pool or SPP and MISO. And the role we play in each RTO differs slightly
as Mr. Purdy referenced earlier. They're very similar organizations. They do have some internal nuances. So based on those nuances, we do still play an active role in both RTOs and our Participation in both is limited to cost allocation, reliability, and affordability, which may directly impact the affordability
Speaker 135
1:19:28
and reliability of the system in Arkansas. Siting is not an area in which
Speaker 133
1:19:36
the commission plays a role with regard to either of the RTOs.
SPP, one of our commissioners serves on SPP's regional state committee, or the RSC, as mentioned earlier by Mr. Purdy. The RSC is comprised of one commissioner from each state within the SPP footprint and provides joint input from state regulatory agencies to the SPP and its board of directors, committees, working groups, and task forces. The RSC has primary authorities in SPP, which means that what the RSC approves is filed at FERC.
The topics in which the RSE has that primary authority is cost allocation, resource adequacy, and long-term congestion rates. We also have one staff member who serves on SPP's Cost Allocation Working Group, or the COG, and a second staff member who supports these efforts. COG is comprised of one staff member for each state who participates in the SPP working group or who is a part of the SPP footprint and essentially operates as the technical support
for the RSC. So it's basically the staff that supports the commissioners who are assigned to that RSC. At MISO, another one of our commissioners serves on MISO's organization of MISO states or OMS as we call it. I'm sorry, I just like come in here and annoy you guys with acronyms and initialisms, I know. OMS is the formal organization of the 15 state commissions in MISO's footprint. That commissioner also serves on the board of ERSC, which is another stakeholder
group within MISO. ERSC stands for Entergy Regional State Committee and is a unique stakeholder entity of MISO's southern commissions, Arkansas, Texas, Louisiana, Mississippi, and the city of New Orleans. One of our staffers serves as the chair of the ERSC working group. I want to emphasize that our work both in MISO and SPP impacts Arkansas rate payers, and our staff and commission work hard to make sure that unfair costs are not passed down to retail rate payers.
Two examples are the current litigation that we have going on right now, our Fifth Circuit appeal of the joint targeted interconnection queue process, which unfairly assigns costs to Arkansas, and our pending FERC appeal of tranche two, although both are pending and therefore my comments are pretty much limited to just referencing them. Both complaints share the underlying concern of the commission in making sure that costs are not unfairly heaped on the ratepayers, especially once those costs
Speaker 135
1:22:35
are set at the federal level, because then the Arkansas
Speaker 133
1:22:40
Commission is preempted from changing them. We are also aware of and tracking the recent notice of proposed rulemaking docket at FERC stemming from a Department of Energy request that will potentially preempt the rtos and the state's legislatures and commissions from setting regulations for large load additions to the transmission grid we have a total of five staffers in addition to commissioners who take on these substantial roles with the rtos and the rto stakeholder groups and that is in
Speaker 198
1:23:08
addition to their full-time psc duty so we do not have
Representative John Maddox
Unverified
1:23:12
any RTO dedicated staffers. Thank you for your testimony. We do have some questions. Representative Richardson, you're
Representative R. Scott Richardson
Unverified
1:23:24
recognized for a question. Thank you, Mr. Chair. Real quick, MISO. Yes. And the other one, SPP. Yes. Do either one of those have corporate offices in the state?
Speaker 196
1:23:37
Yes, they do. They both have corporate offices right here
Representative R. Scott Richardson
Unverified
1:23:40
in Little Rock. Okay. And how many SPP, you can probably answer this.
How many employees do you currently employ here
Representative Jim Wooten
Unverified
1:23:47
in the state? In the state, we have some remote, about 30 or 35, that are remote. The remainder, about 850 or so, are here in Little
Speaker 113
1:23:54
Rock. Okay, thank you. Representative McGrew, you're recognized
Representative Richard McGrew
Unverified
1:24:05
for a question. Mr. Chairman, assuming what you're already dealing with, with SPP and MISO, it seems like quite a bit it's going to require more personnel if we go into this compact
and also do the is there additional fees for all of these members that have to do they have to pay to be part of this compact will and increase the fees to the
Speaker 133
1:24:31
customers um from my understanding of it i don't i'll take your second question first regarding fees i have not perceived there to be fees associated that would be passed on to retail rate payers. However, with regard to your first question, I'm not certain regarding our staffing needs. I think it would make sense to have the
same personnel currently working on SPP and MISO to also work on this. They would be the most familiar with it. However, as I did mention, they are not dedicated solely to RTO work. So um is it within their bandwidth it's it's not specific to this it's
Speaker 198
1:25:09
just there's always a question of bandwidth for us so i guess the question is more would it
Representative Richard McGrew
Unverified
1:25:16
require more personnel are these people not busy right now and they have time to do the extra work um
Speaker 133
1:25:23
it is i it is i'm on i'm unclear at this time it is possible that it could require um additional personnel but i'm i'm not um committed to that and and i would i would just add on to
Speaker 39
1:25:40
like you know we've actually already adopted the isp i'm glad we're still having a conversation about the compact because i think it's important that we get an idea if this is something we need to do or not but right now i think we need to have like this the the purpose
of this was really just have a larger conversation about like just transmission in the state and and how we're doing in that. And I'm glad she's here so she can help have a conversation with us about how that would affect the rate payer. But I really, we can continue to talk about the compact, but I really want to keep it focused on like transmission and what we're going to
Representative Dwight Tosh
Unverified
1:26:15
do in the state to ensure we've
Chair
Unverified
1:26:21
got the best policy. Representative Lightyman, you're right now for a question. Thank
Representative Jack Ladyman
Unverified
1:26:26
you, Mr. Chair. Well, you know, the electrons don't know where the state
line is right so they're produced in oklahoma or whatever and they go everywhere and you all are involved in in rates now because like interg is in five states and like you said the portion of their production what comes to arkansas so but my question is uh in the past have there been uh issues uh when it comes to interstate transmission uh with arkansas law versus say oklahoma since we're talking about northwest Arkansas I mean have there been issues there that had to be worked out
in the state laws that might be improved by
Speaker 134
1:27:14
specific areas of law that might cause a conflict as you mentioned as I mentioned the PSC has has limited transmission jurisdiction so especially in terms of interstate transmission um we are aware of those things we we participate in stakeholder groups um but i almost i don't
know if that's a question better opposed to
Speaker 119
1:27:44
spp or yeah do you have any comments on that i'm not aware of any
Representative Jim Wooten
Unverified
1:27:49
uh state laws or regulations that that uh that we deal with that are problematic Most of the regulations that determine how SPP plans the system are federal in nature or related to the North American Electric Reliability Council. Okay, thank you. Thank you, Representative Leitemann.
Representative John Maddox
Unverified
1:28:09
Seeing no further questions for Ms. I got something. I apologize. Senator Johnson, you're recognized.
Senator Mark Johnson
Unverified
1:28:16
Danny, you said something about the federal energy and a policy that would limit our regulation ability on large loads. Could you go into that a little bit because that's about the only thing that's rang my bell so
Speaker 133
1:28:31
far. So I can get you some more information on that besides that I
Speaker 134
1:28:36
am generally aware of it. I don't have enough understanding of it to give you much more than what I mentioned,
but I can follow up and get
Senator Mark Johnson
Unverified
1:28:48
you quite a bit more. Is that something that's happened in this administration or
Speaker 133
1:28:54
a previous administration that we're dealing with? I believe that it is recent. I believe it's quite recent, but I'm not certain
Speaker 119
1:29:03
of that. I can add a little bit. I am aware that FERC
Representative Jim Wooten
Unverified
1:29:09
and the Department of Energy have recently initiated a request for information from utilities and regional transmissional organizations about how to improve what they call it the
speed to power initiative to improve the speed with which new transmission projects can be developed for both data centers and for the resources, the generating resources that would be needed. So that's a relatively recent development. There's still a lot of activity going on there, but that is at the federal
Speaker 55
1:29:40
level and did originate with FERC and the department of energy so do
Senator Mark Johnson
Unverified
1:29:45
you think they're trying to eliminate some of the the regulatory bureaucracy that states involve themselves in to create these things faster is that i mean that's
Representative Jim Wooten
Unverified
1:29:58
what i'm hearing from your i think they're looking for information primarily at this point to figure out where the bottlenecks are you know there's a there's definitely a distinction between federal and state jurisdiction, that the feds have limited levers that they can pull. They can't, you know, go into areas of state jurisdiction. So I think they're trying to figure out what problems exist
Speaker 55
1:30:26
currently that could be addressed at the federal level.
Senator Mark Johnson
Unverified
1:30:30
That's my perception. It's going to be hard to get beyond that because it's our job to protect citizens and all
your members. So thank you. Senator Irvin,
Senator Missy Irvin
Unverified
1:30:50
do you recognize for a question? Thank you.
And a little bit of a follow-up. If the federal government does initiate, does Southwest or these groups also apply for any kind of subsidy
or federal funding because for any – or is that your individual members
Speaker 181
1:31:09
that would apply? It depends on what it is
Representative Jim Wooten
Unverified
1:31:14
and the type of grant or program. We have been involved in projects that have received federal grants in the past, and those are generally a cooperation between the states and the utility companies applying for those grants and going through that process,
but it varies with the grant and with the type of
Senator Missy Irvin
Unverified
1:31:37
project. Okay. And so with what you just answered with Senator Johnson, do you think
that the federal government is trying to explore, like you stated, where the areas may be in conflict in order to direct policy through that grant-making
Representative Jim Wooten
Unverified
1:31:56
process? I see it more through the rules and regulations and how to speed up things like the study evaluations
that assess what the needs are and what the impacts are, how to get through the RTO and the planning processes faster in order to get to an issuance of approval to construct something faster. That's probably the limits to what they would have control over or authority over. The existing regulations at the state level
Speaker 100
1:32:32
will probably, in my view, fall outside of FERC's jurisdiction in that instance.
Representative John Maddox
Unverified
1:32:38
Okay. Thank you. Thank you, Senator. Seeing no further questions, Mr. Bailey, would you like to introduce yourself and present your
Speaker 144
1:32:53
testimony? Hey, good morning. Thank you. Chair Maddox, Chair Johnson, and members of the committee, it
Brent Bailey
Unverified
1:32:59
is an honor and a privilege to be here with you today as I help continue this discussion on ways to increase access toward affordable, reliable energy through beneficial transmission expansion.
My name is Brent Bailey, and I'm former Public Service Commissioner in Mississippi from the year 2020 to year 2024, and currently Vice President at EPL Advisors in Central Mississippi. While at the Mississippi PSC, I represented the commission on the Intergy Regional State Committee Board and the Organization of MISO State Boards, which Ms. Danny referenced earlier in her comments. So high-voltage transmission infrastructure, it's much like the arteries and veins that move blood throughout our body.
And just like when constriction or blockage in the arteries of our body is a problem, congestion and overload on our transmission network prevents the efficient movement of electricity to our homes, business, and industries. Again, that's a problem. There are more than 500,000 miles of transmission lines in the U.S., and in my best guesstimate, there's about 8,000 miles of transmission lines in Arkansas. The average age of the transmission grid is 40 years old, with a quarter of the grid at 50 years old or older, and transmission lines typically have a
lifespan of 50 to 80 years. So some would think we're at a critical juncture. The demand for the consumption of electricity will grow in Arkansas and across the region. The intensity and scale of this growth and growth in demand is still uncertain. But report after report projects robust growth in demand through the year 2035. That's just 10 years from now. And did I mention that the average age of electric grid is 40 years old.
So outdated transmission components create bottlenecks that prevent electricity flow as well as prevent access to more cost-effective generation resources, increasing the overall cost of energy for consumers. Aging systems are more vulnerable to cybersecurity risks, stress, and outages, and are less resilient in the face of extreme weather events. Older capacity-constrained transmission can not only delay the interconnection of new generation facilities and also delay the interconnection of new large scale industrial customers resulting in missed economic opportunities. So are we in a crisis?
I guess it depends on your perspective. So two weeks ago the president of the North American Electric Reliability Corporation in his testimony to the Federal Energy Regulatory Commission said that the risk and challenges to reliability amount to a five alarm fire. So the various risk to grid liability that he identified the ability to site and permit needed infrastructure is a growing challenge. Admittedly the ability to construct short-run in-state transmission lines to address local reliability issues or other local issues other local concerns has generally not been
hampered as we heard Ms. Danny talk about. However the construction of large-scale interstate or interregional transmission lines has been nearly non-existent in the region despite data detailing how the construction of interstate transmission can create access to cost competitive clean electricity and deliver net positive benefits for Arkansans. Arkansas is uniquely positioned to enjoy significant economic benefits from regional transmission expansion. Currently a
transmission bottleneck exists between MISO's northern and southern regions that limits the amount of electricity that can flow between the regions. This constraint at the Arkansas-Missouri border can cause congestion, which forces some generators to curtail output and leads to higher costs to consumers. Should that north-south transfer capacity be expanded through new transmission investment, Arkansas consumers can draw from a broader portfolio generation, putting downward pressure on prices and increasing reliability. Furthermore, the lack of a robust
east-west inter-regional transmission connections from MISO and SPP prevents Arkansas's access to energy resources in Oklahoma and Kansas. Congestion values add greatly to the cost of energy that is acquired. In a recent NREL study of options for Arkansas's energy mix found a significant need for increased inter-regional transfer capacity to maintain and improve reliability and resiliency, relieve congestion, and meet future generation and demand growth.
So why hasn't this action already been taken to resolve these recognized constraints, create access to more cost-effective resources, and open the door for more system capacity? Well, everybody has their opinion. Some say it's a combination of utility protectionism. Maybe it's a lack of substantive long-range planning action and or an absent of consensus on cost allocation determination for these multi-jurisdictional projects. It's also true that lengthy, unpredictable siting and permitting processes
can slow transmission deployment, increase cost, reduce liability, and disrupt economic growth. That's why it's so important for state and local leaders to implore their congressional members to pursue federal permitting reform, reform that sets clear timelines and deadlines for agency reviews, stakeholder engagement, and litigation action, improves coordination between federal, state, and local governments, and streamlines final approvals, particularly for those low-impact projects. So these reforms at the federal level will allow more construction projects to move
forward confidently and with less risk. Risk is always a factor we want to reduce. But interstate and interregional communication and cooperation among stakeholders, particularly legislative stakeholders, it's still critical to ensure that local construction and expansion of new interstate high-voltage transmission infrastructure can occur. Cooperative discussion and action among states can establish consistent, uniform planning, siting, permitting, and construction that avoids misalignment of standards that can stall development of state lines. You have heard from
SPP regarding some of the challenges, complexity of transmission planning, and deployment they've seen and experienced. Bakerts described how new conductor designs can increase transmission efficiency, reduce line loss, and provide net savings for customers. And of course, the Arkansas PSC described their process and how they review applications, evaluate criteria, and determine if a project is in the public interest. So your understanding and visibility into the critical facets of large-scale interstate transmission playing and development is key to Arkansas's
economic prosperity. Did you know that Arkansas leads the southeast in clean energy projects stuck in a generator interconnection queue? At 44,200 megawatts of generating capacity representing everything from solar to natural gas, many billions of dollars in investments in communities across the state, these projects are waiting to be evaluated where the transmission conditions allow them to be safely and reliably integrated into the grid network. And there's broad bipartisan support in Arkansas for grid modernization and expansion connect clean energy
resources, strengthen liability, and lower these costs. A poll was conducted in August 2025 surveyed a thousand likely general election voters across Arkansas. Seventy percent of these voters polled support making investments in the electricity grid, recognizing the grid is aging, and upgrades are vital for our national security. With 90% of those surveyed saying they are concerned about rising utility bills, a majority of these voters are willing to pay more in the short term to
upgrade transmission in order to achieve lower costs in the future. So in conclusion, to maintain a viable and growing Arkansas economy and to ensure a secure, reliable power supply, transmission must be modernized capacity must be expanded and it must be done in a way that is responsive to the needs and demands of future economic growth to that of the citizens of arkansas because for each transmission dollar invested communities in the state benefit so i appreciate the opportunity to
thank and thank you for your your time today and share our thoughts on the dynamics of our of our evolving economic and energy economy
Representative John Maddox
Unverified
1:41:36
here in the region thank you for your testimony
Senator Missy Irvin
Unverified
1:41:40
senator ervin you're recognized for a question yes when you say clean energy can you
be specific as to what you're referring
Representative Jon S. Eubanks
Unverified
1:41:48
to well clean energy of course that content that can consist of your traditional renewable energy resources that we're all familiar with but also clean energy falls in the
definition of nuclear non-emitting natural gas
Brent Bailey
Unverified
1:42:03
and other fossil fuel resources that that may or that may utilize carbon capture sequestration technology and or hydrogen co-firing opportunities down the road as we continue to see these technologies evolve. Okay, so that's the reference.
Senator Missy Irvin
Unverified
1:42:20
Nuclear is involved and natural
gas is considered clean energy, according to your testimony. I think each state and
Brent Bailey
Unverified
1:42:29
each jurisdiction has their definition,
but certainly those non-admitting generation resources typically fall within the purview
Senator Missy Irvin
Unverified
1:42:37
of that definition. Okay. And then the last thing, too, I wanted to ask you,
I appreciate your testimony, by the way. I do think that it's an important balance that we have to strike as to how we need to proceed with ramping up our grid and providing more resources. However, you know, I want to make sure that you have to always remember the taxpayer or the ratepayer and the load that's going to be put on them and how fair is that for somebody particularly who's an elderly couple that's on fixed incomes.
Because, you know, I had an issue with that recently in one of my counties that I represented. And so, you know, as we're looking through that, have you ever come across a policy where that's, I don't know if amortized is the correct word, but maybe, but to where the policy is really considerate of how it's paid for by rate payers taking into consideration somebody who is an elderly couple who may have to pay for this,
but will never actually realize the benefit from it. That
Speaker 237
1:43:58
is a question that any utility regulator has wrestled with at any part
Brent Bailey
Unverified
1:44:04
of their career to consider the rate impacts across the customer base, you know, not trying to favor or discriminate against any one rate class, but certainly the elderly. And how do you, you know, determine, you know, what that impact is going to be going forward? You know, you've seen things in other places like maybe certain considerations given to SNAP beneficiaries or others to give them access to certain tools, certain programs to help offset some of those cost increases.
There's challenges in applying those. Typically, resources run short. And it is a challenge. And I don't know if there is certainly no one way to resolve that, but how these investments are made, how costs are allocated through the cost causers and who's the ultimate beneficiaries are to ensure that those creating any of those investments are typically footing most of those costs.
And that's where the various principles fall in that SPP and others have to be cognizant of. And I know Arkansas and even my state of Mississippi are involved in certain measures to further define those. And it's something that's going to have to continue to be talked about. And, again, that's something where the compact could lead to more visibility with decision makers who ultimately answer constituents.
Public service commissioners in Arkansas are appointed. I was elected, so phone always rang every day from unhappy ratepayers,
Representative Jon S. Eubanks
Unverified
1:45:51
those considered bills. So I get that, and it is a decision I had to work with. Yeah. No, I
Senator Missy Irvin
Unverified
1:45:58
appreciate it. Thank you for the conversation. Thank you, Senator Irvin. Seeing
Speaker 229
1:46:03
no further questions, I apologize. I'm going to go
Representative John Maddox
Unverified
1:46:10
here. I apologize. I'm going to go here, John. Senator John.
Senator Mark Johnson
Unverified
1:46:15
So just, you know, this is all theoretical and part of discussion in this compact and not a set policy or anything that we're considering here today. But me, as sitting here, we would need to, if we were going to consider this, you need to have Oklahoma, Missouri, and Tennessee into this thing. And only if we create efficiencies in the processes, you know, state to state,
would it be worthwhile in consideration because, you know, you spoke about, you know, the north, south, and east and west. The north, south, you know, SPP sets in between MISO in that north-south, you know, state-line border area. And you're going from MISO to SPP east-west in your thing. And a lot of these efficiencies, I think, is what Danny was addressing on the Department of Energy level,
on the federal level, rather than state-to-state level, because most of the issues that I think SBP and MISO have is federal regulation, not state-to-state regulation. Am I wrong in anything I said in my statement? No, sir. But, you know,
Representative Jon S. Eubanks
Unverified
1:47:39
the way that the compact has been discussed is really RTO
Brent Bailey
Unverified
1:47:44
specific. You know, the states that were mentioned, Mississippi, Arkansas, Louisiana, and Texas are all involved in MISO South.
Yes, they share some areas with SPP. Mississippi shares area further to the east in the SIRTEP region. But it's really to coordinate and create more instructional visibility and understanding within the process from the legislative perspective and to avoid and understand if there may be certain misalignment and state permitting processes and find that and have the conversations at that level to potentially resolve that. This conversation is also going on in upper SPP
in the states of North Dakota, South Dakota, and Montana. They've expressed interest in something along those lines. And even in what's called the PJM RTO further to the east, Kentucky, Ohio, and Pennsylvania are looking at this concept as well. No two are the same. I get that. But there are other states within the nation that are looking at this discussion to have this communication at the legislative level. Again, not usurping any state authority that their public service commissions will have, but better understanding and ideas of what are the challenges, complexities of long-range transmission planning,
interstate, interregional planning, and how they can better accommodate that and facilitate a more consistent and simpler approach is what we all want to achieve with this. You know, compacts are nothing new. We all are in compacts and interstates. We recognize each other's driver's license, nurse's license, building contractor license. Arkansas is part of the compact that authorized the Southern States Energy Board has an interest on that, and, of course, they have specific functions as well.
So this is hopefully an opportunity to focus on interstate, interregional transmission opportunities to ensure cost-effective expansion of those critical infrastructure resources. So the transmission,
Senator Mark Johnson
Unverified
1:49:44
it's out-of-date, the infrastructure. I don't think there's going to be a mass change in that. And this is kind of like creating interstates and using the two lanes you have now
and then putting in another two lanes with a better infrastructure in it. In my opinion, those new ones would go parallel in our infrastructure and in a situational basis, not across the board broad view to increase your cost dramatically through transmission. I think, you know, it would be project to project. You would put that other system in there parallel, the new efficient system,
not scrap the system you've
Speaker 247
1:50:40
got now of transmission and start anew. I think those would be parallel
Representative Jon S. Eubanks
Unverified
1:50:46
systems. I would typically agree. And our focus, or I think generally everybody's focus, is to add more capacity, better performance with the grid we have. Baker talked about some of the
Brent Bailey
Unverified
1:50:59
opportunities they have, what's, you know, reconductoring. Some of that may fall in the realm of what's called grid-enhancing technologies, which are more near-term, cost-effective. Whether it's reconductoring, whether it's reevaluating your line performance, dynamic line ratings are practices discussed there,
other alternative transmission technologies to really build capacity in the near term while still conducting what those long-range planning and long-range needs are over the next 5, 10, 15, even 20 years, as we've heard. Thank you. Representative Blademan, recognized. Thank you, Mr. Chairman.
Representative Jack Ladyman
Unverified
1:51:35
is for Representative Grimlich, really. I don't know if it's a question or a statement, but maybe you can say you agree or disagree. But, you know, we are well positioned here, and as was stated, we have all of the above types of energy.
We've got the cleanest burning coal plant in the nation. We've got two nuclear plants. We've got wind. We've got solar. We've got geothermal. We've got all that. And as I've said many times, we're a state of border cities. Memphis will have demand for power. Even St. Louis and Dallas, maybe even Oklahoma City or Tulsa. I think we are a net exporter of power right now, and we can export more power. So if we generate more power and sell that, the economics of volume will help our current rate payers, I believe.
So that's just my input. And I think anything that we can do to make this more efficient and reduce the cost will help our rate payers rather than cause them to cost more money. But we do need the input. My input here is we need the input from the power providers, the companies that produce the power. You know, how does this affect them, the compact? What is their input into this process? So I think that's something that we need to find out. But thank you for bringing this forward. Do you agree? Yes.
Speaker 70
1:52:57
Good answer. Any further questions, members? I just want to close. Now that everyone's had an opportunity to present, we'll take any
Speaker 39
1:53:08
questions. But thank you all for giving us time today. You know, if you ever get a chance, you need to go to SPP. Or I haven't had an opportunity to tour MISO yet, but, you know, they'll take you down. They'll show you their bottlenecks. They have areas of the country where basically people are paying to just sell their electricity because there's just no access.
The transmission is so poor. You know, Beckert has an amazing facility in western Arkansas. You know, Representative Rose, Richardson, Hall, Crawford, myself, and I'm sure others have plenty of employees who benefit from the jobs that they have there, and I want to see them grow and prosper. But, you know, like, we want to decrease costs for consumers. We want to decrease loss in electricity, and we want to prevent those bottlenecks so everyone can have those reap the rewards of that.
So thank you very much for your time today. Thank you for
Representative John Maddox
Unverified
1:54:03
having a conversation with Transmission with me. Thank you, Representative Gramlich,
and thank you to the presenters. It was very informational. You guys did a tremendous job, so thank you. There's nothing to do as the ISP has already been adopted, so thank you for your work on that, Representative Gramlich. The next item is F, and that is just a report that we need to recognize. That is the report concerning the progress and activities for a psychiatric collaborative care model pursuant to statute.
We just have to recognize that, so that is in your packet, members. Any questions on that or concerns on that? Okay, the last item on our agenda is other business. Is there any other
Senator Mark Johnson
Unverified
1:54:45
business that needs to come before the committee today? I would like to bring something. So there's an issue in the state about UnitedHealthcare, and they're in negotiations with some of our folks, and some of our state employees are going to be impacted by
that depending on that negotiation if insurance commissioner could come down and share that with the members Jimmy Harris interim insurance commissioner
Speaker 254
1:55:34
Sarah Faris general counsel Arkansas insurance
Senator Mark Johnson
Unverified
1:55:39
department Jimmy if you could just give us a update on who all is in negotiation with with this group and and let us know the impact regionally and across the state sure
Speaker 253
1:55:53
currently any a Baptist and UHC are in negotiations to extend their provider agreement. I believe it currently expires November 15th. We've been in contact with UHC three or four times over the last three weeks
asking for updates. They've assured us they're continuing good faith negotiations. In the meantime, AID is reviewing the network adequacy aspects of this, what kind of impact it may have. You know, we are looking at the distance of the acute care hospital in Paragould, which is, I think, 27 miles from Jonesboro. And as you know, to meet network adequacy standards,
90% of the population of a county need to be covered within 30 miles driving distance between, you know, two and acute care hospital. While the hospital in Paragould will cover most of Craighead County, it will leave out a large land area on the eastern side. It appears for acute care hospital, the network will remain adequate.
However, there could be some issues with specialty providers that have a 10-mile distance. We've requested all of the provider identifiers from UHC Friday. They responded same day with those MPIs, and we're reviewing those as of this morning. So, in that scenario,
Senator Mark Johnson
Unverified
1:57:45
that hospital is merging with NEA Systems?
Speaker 253
1:57:50
Currently, it's on a different provider agreement and will remain in network. The only provider agreement that's being negotiated right now is with NEA Baptist. Okay. Okay, I'm confident an agreement will be reached. This is similar to the Conway Baptist Health, or I'm sorry, Conway Regional UHC negotiations that took place a couple years ago.
It spills over into the media. It's a big deal. It affects
Senator Mark Johnson
Unverified
1:58:31
a lot of people, and we are definitely monitoring it. Is UAMS in the same situation with their negotiations?
I don't know about UAMS. I haven't heard. So could we get –
I mean, this is our, you know, considered state folks.
If you could come down. Just
to introduce yourself, I know you can't speak directly to those negotiations, but if you could give
Speaker 256
1:59:22
us an overview of the impacts and possibilities.
Speaker 260
1:59:27
Sure. Good afternoon everyone. Melissa Rust with
Speaker 261
1:59:29
the University of Arkansas System.
Please forgive my voice. Today's the first day to have any voice at all and in several days and so as you I think many of you know the University of Arkansas System runs and operates a self-insured health plan for all the campuses that are part of the UA system which includes UAMS and the negotiations with United or UHC and UAMS have been resolved so as I
understand this issues it's been explained to me mr. chairman is this is an issue right now with Northeast Arkansas Hospital and UHC which is separate from the U of A but I understand a question had come up about an individual who who is a UMS employee that resides in in the northeastern Arkansas area of the state and I I'm certainly hopeful obviously that UHC and Northeast Arkansas in a bad hospital are able to resolve you know their
contractual issues and be able to renew their contract that's separate and apart from anything has anything to do with U of A but if that did not occur then we would cover those individuals that are part of UAMS and part of the UAMS plan in network for up to 90 days and then we would have to assess any time period beyond that time but hopefully we hopefully this will be resolved and we won't we won't be addressing that issue thank you very much thank you very much
Speaker 263
2:01:10
Commissioner anybody else got a question there
Speaker 189
2:01:20
controls represent Baker you recognized for a question thank
Representative Sonia Eubanks Barker
Unverified
2:01:26
in two-part but directly to Melissa rust what is the autonomy that the self-funded plan has over their vendor is it your understanding that you guys have hired United Healthcare to be your third-party administrator, is
Speaker 260
2:01:40
that correct? My understanding, Representative Acor, is that
United or UHC, you know, is that they are the third-party
Speaker 261
2:01:46
administrator for the self-insured health plan that the University of Arkansas system operates. But you are the client for United Healthcare, is that correct? We have
Speaker 268
2:01:55
a contract with them, yes. As self-insured, do
Representative Sonia Eubanks Barker
Unverified
2:02:02
you have the ability to dictate more of these negotiations or have a say in that since you are the ultimate payer? I frankly am not certain.
Speaker 261
2:02:13
I know the answer to your question, to be candid. I'm not involved in the direct operation of our self-insured health plan, so I would be hesitant to try to answer anything more than, frankly, what I've said thus far. I
Representative Sonia Eubanks Barker
Unverified
2:02:30
self-insured entity for United, or not for United, but for the University Health Systems is the ultimate payer and you have a vendor that is having these disagreements, yet you're the one that's ultimately responsible for funding this and facilitating that, what is the working relationship with you at UnitedHealthcare?
Have you guys turned over operational authority to UnitedHealthcare on the plan, or does the plan have operational authority? Once again, I believe the plan has operational
Speaker 261
2:02:59
authority, but as I said, that's something I would have to ask and talk to the individuals who actually operate our self-insured health plan to be able to tell you that with any sense of clarity. Okay, thank you. Thank you for your question, President Baker.
Representative John Maddox
Unverified
2:03:20
Any further questions from the committee? Seeing none, thank you for your testimony, for bringing all that attention to this important issue. And seeing no further business, we would adjourn.
Agenda
A. Call to Order
B. Consideration of a Motion to Authorize Chairs to Approve Special Expenses Incurred by the Committees
C. Consideration to Approve the December 16, 2024, Meeting Minutes [Exhibit C]
D. Consideration for Adoption of Interim Study Proposals (ISP) [Exhibits D1-D15]
E. Discussion of Interim Study Proposal 2025-072 by Representative Gramlich – To Adopt the Fair and Efficient Transmission Compact [Exhibit E]
F. Arkansas Department of Human Services, Quarterly Report Concerning the Progress and Activities for a Psychiatric Collaborative Care Model, submitted pursuant to A.C.A. § 23-99-422 (f)(1) - (f)(2) (Act 615 of 2023) [Exhibit F]
G. Other Business
H. Adjournment
Documents
Speakers
Representative John Maddox
Unverified
Senator Justin Boyd
Unverified
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Representative Jim Wooten
Unverified
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Representative Jack Ladyman
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Representative Dwight Tosh
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Representative Jon S. Eubanks
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Chair
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Senator Stephanie Flowers
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Senator Missy Irvin
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Brent Bailey
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Representative Richard McGrew
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Representative R. Scott Richardson
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Senator Mark Johnson
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Representative Sonia Eubanks Barker
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