There are two Arkansas solar markets, and the line between them is a single date. If your interconnection paperwork was in before September 30, 2024, you keep one-to-one retail net metering until June 1, 2040. If it went in afterwards, every kilowatt-hour you export earns avoided cost instead, which on Entergy Arkansas means 3.34¢ against the 12.81¢ statewide average residential rate. Same panels, same roof, same utility, roughly a quarter of the export value. Act 278 of 2023 drew that line, and almost everything worth knowing about incentives here follows from which side of it you are on.
One Date Splits the State in Two
Your position | What exports earn | How long it lasts |
|---|---|---|
Paperwork in by September 30, 2024 | Full retail, one-to-one | Through June 1, 2040 |
Anyone applying since | Avoided cost, redetermined every year | Reset annually, no end date |
What you pay to buy power | Retail (statewide average 12.81¢), either way | Unchanged by Act 278 |
If you bought a house with an existing solar system, this is the first thing to establish, because the grandfathered position is genuinely valuable and it runs another fourteen years. Ask the seller for the interconnection agreement and its date.
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The Avoided-Cost Rate Just Went Up 35%
This is the part that surprises people, because most states in transition have watched their export rates fall. Arkansas ties the credit to a trailing twelve-month average of MISO market prices and redetermines it annually, so it moves with the wholesale market in both directions. Entergy Arkansas Schedule 71, filed under Docket 23-070-TF, went to $0.0334 per kilowatt-hour effective March 2, 2026, up from $0.0247 the previous year. That is a rise of about 35% in one annual reset.
Two consequences follow. First, any quote modeling your Arkansas exports at a flat rate for twenty-five years is modeling something that has never held still. Ask what assumption it uses and how it handles the annual redetermination. Second, the rate can fall again just as easily, so the sensible planning position is that exports are worth roughly a quarter of retail, give or take.
Other utilities file their own avoided-cost rates on the same annual cycle, so the Entergy figure is not a statewide number. Southwestern Electric Power, Carroll Electric and First Electric each set their own, and the cooperatives serve a substantial share of the state.
Does Arkansas Have a State Solar Tax Credit?
No. There is no Arkansas state income tax credit for residential solar and no statewide rebate program. Arkansas’s support for solar has always run through the netting rules, which is precisely why Act 278 mattered so much: changing the netting rules was changing the entire incentive.
The federal residential credit is $0 for purchased systems whose installation is completed after December 31, 2025 under Public Law 119-21. Arkansas also restricts residential power purchase agreements rather than authorizing them outright, though solar leases are legal here. Since third-party ownership is now the only route by which a federal credit reaches a residential roof, that distinction is worth raising explicitly with any company offering you a no-money-down arrangement: ask whether it is a lease or a PPA, in those words.
The Costs That Do Not Appear in the Headline
Entergy Arkansas charges an interconnection fee of $196.75 for systems under 300 kW. It is a one-off charge. Put it in the model up front. Under the current rules the customer also keeps the renewable energy certificates associated with their generation, which is worth confirming in your own agreement before you sign.
You Likely Will Not Qualify If
- You are hoping to get grandfathered. That window closed on September 30, 2024 and cannot be reopened by applying now.
- You expected a state tax credit or rebate. Arkansas has neither, at any income level.
- You are counting on the 30% federal credit. It is $0 for purchased systems whose installation is completed after December 31, 2025.
- You are on a cooperative and assumed the Entergy rate applies. Carroll Electric, First Electric and the other cooperatives file their own avoided-cost rates annually.
Where This Leaves Arkansas Homeowners
With no cash incentive and exports at roughly a quarter of retail, the Arkansas case now rests almost entirely on self-consumption. That is a narrower proposition than it was before Act 278: a household that uses most of what it generates still displaces power near the 12.81¢ statewide average, while a household that exports heavily is selling at 3.34¢ and buying back at retail.
The practical implications are sizing to daytime load rather than to annual total, shifting what you can into generating hours, and treating storage as a way of keeping kilowatt-hours at retail value. Our Arkansas cost guide covers pricing, and the Arkansas installer list covers who does the work.
Arkansas Solar FAQs
Only for systems whose interconnection paperwork was in by September 30, 2024. Those customers keep one-to-one retail netting through June 1, 2040. Everyone applying since Act 278 of 2023 took effect is on net billing: imports at retail, all exports credited at an annually redetermined avoided cost.
On Entergy Arkansas, $0.0334 per kilowatt-hour effective March 2, 2026 under Schedule 71, up from $0.0247 the year before, a rise of about 35%. The rate is set from a trailing twelve-month average of MISO market prices and is redetermined every year, so it moves in both directions. Other utilities and the cooperatives file their own.
There is no Arkansas state solar tax credit and no statewide rebate. Support here has always run through the netting rules, which is why Act 278 of 2023 rewrote the incentive when it rewrote export crediting. Changing how exports are credited changed the entire incentive.
Entergy Arkansas charges $196.75 for systems under 300 kW. It is a one-off fee; put it in your model up front. Under current rules the customer also keeps the renewable energy certificates from their generation, which is worth confirming in your own agreement.
The interconnection agreement and its date. A system whose paperwork was in by September 30, 2024 carries one-to-one retail netting through June 1, 2040, which is genuinely valuable and runs another fourteen years. Ask for the document itself, because a post-cutoff system is on avoided cost at roughly a quarter of retail.
Which side of the date you are on decides the whole calculation. Enter your ZIP code and we will work it out with you.
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References & Research Sources
EcoGen America reviewed Act 278 of 2023 and the Public Service Commission net metering rules, Entergy Arkansas tariff filings, federal energy data, and IRS guidance for this page. Sources accessed between June 10 and August 20, 2026.
- Arkansas General Assembly and Public Service Commission. Act 278 of 2023 and the PSC net metering rules. The September 30, 2024 grandfather cutoff and the June 1, 2040 grandfather term. Accessed August 20, 2026.
- Entergy Arkansas. Schedule 71, Docket 23-070-TF. The $0.0334 per kilowatt-hour avoided-cost rate effective March 2, 2026, the prior-year figure of $0.0247, and the $196.75 interconnection fee. Accessed August 20, 2026.
- U.S. Energy Information Administration (EIA). Form EIA-861 (2024) and Electric Power Monthly. Utility customer counts for Entergy Arkansas, Southwestern Electric Power, Carroll Electric and First Electric, and the statewide average residential price. Accessed August 20, 2026.
- Internal Revenue Service (IRS). One, Big, Beautiful Bill Provisions. Guidance on the Public Law 119-21 termination of the Section 25D residential credit for systems whose installation is completed after December 31, 2025. Accessed August 20, 2026.
