Home solar in Arkansas

Net metering Replaced by a lower credit

Act 278 of 2023 ended 1:1 net metering for new customers. For new systems the utility picks a rate structure: either it bills all power you buy at retail and credits each kWh you export at its avoided cost (the prior year's average wholesale market price), or it nets kWh but adds a monthly grid charge. Homes that filed an interconnection agreement (or paid facilities costs) before Sept. 30, 2024 keep the pre-2023 1:1 terms until June 1, 2040; that status stays with the house if sold. Credits carry forward with no expiry. Home systems are capped at the lesser of 25 kW AC or 100% of your highest monthly use in the past year. Source

• 2023-03: Act 278 signed (emergency clause)
• 2023-12-29: PSC's revised net-metering rules take effect
• 2024-09-30: last day to apply for grandfathered 1:1 net metering
• 2040-06-01: grandfathered 1:1 terms end

Solar credits (SRECs) No market

Arkansas has no SREC market and no renewable portfolio standard that pays homeowners for solar credits.

Taxes

Property tax: None found: no state property tax exemption for home solar.
Sales tax: None found: home solar equipment appears to pay normal sales tax.

Solar laws

• Act 278 of 2023 (SB 295), Customer Protections for Net-Metering Customers Act (2023). Moves new net-metering customers to avoided-cost export credits (plus an optional adder of up to 40% if benefits are shown) or netting with a monthly grid charge. Grandfathers 1:1 terms to June 1, 2040 for systems that applied before Sept. 30, 2024. Home size cap: lesser of 25 kW AC or 100% of highest monthly use. Source
• PSC Net-Metering Rules, 126.00.23 Ark. Code R. 001 (2023). Puts Act 278 into practice: legacy status runs to June 1, 2040 and stays with the premises; avoided cost updated yearly; credits carry forward indefinitely. Source

Community solar

No state community solar program found; Act 278 also narrowed the multi-meter arrangements that earlier shared projects used.

Timeline

1. 2001 Arkansas Renewable Energy Development Act creates net metering
2. 2023-03 Act 278 signed, ending 1:1 net metering for new customers
3. 2023-12-29 PSC's revised net-metering rules take effect
4. 2024-09-30 Deadline to lock in grandfathered 1:1 net metering
5. 2025-12-31 Federal 30% homeowner tax credit (25D) ends
6. 2040-06-01 Grandfathered 1:1 net metering ends

Federal tax credits

The 30% federal tax credit for homeowners who buy solar (Section 25D) ended for systems placed in service after December 31, 2025, so buying no longer earns a federal credit. If you lease or sign a power purchase agreement (PPA), the panels belong to a company that may still claim a business credit under federal deadlines that tighten through 2027. Ask your installer whether that savings is in your price.

Sources

• Act 278 of 2023 (SB 295, as engrossed 3-6-2023)
• Arkansas PSC Net-Metering Rules (Cornell LII copy)
• UA Cooperative Extension: Net metering policies in Arkansas
• KUAF: Arkansas solar laws leave company chasing growth elsewhere (6-25-2026)
• EIA Electric Power Monthly Table 5.6.A

Last checked 2026-11-01. Incentives are not guaranteed and can change or run out. Confirm every figure with your utility, installer and a tax professional before you sign. This page is general information, not tax, legal or financial advice.

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