HB1661 Summary

• Changes the reference date for cost allocation rules from January 1, 2015 to January 1, 2021 for electric and natural gas utilities under the Formula Rate Review Act.

• Allows the Arkansas Public Service Commission to approve cost allocation adjustments and rate design changes for large electric utility customer classes (exceeding 7 million megawatt hours annual usage) during formula rate review extensions.

• Establishes specific provisions for utilities with projected year test periods, including limitations on debt-to-equity ratios, capital structure components, and requirements to base projections on historical averages rather than corporate budgets during five-year extension terms.

• Limits revenue changes to 4% per rate class per formula rate review period and allows the commission to adjust rates when increases exceed 10% for high-consumption customer classes.

• Declares an emergency to allow immediate implementation, citing the need to maintain stable utility rates and clarify regulatory procedures for public utility investments.