✅ Federal Incentives
30% Investment Tax Credit (ITC) for solar + battery systems (residential & commercial).
MACRS + Bonus Depreciation for commercial systems.
Direct Pay available for nonprofits and tax-exempt entities (requires IRS registration).
Credit carryover: Unused credits may roll over to future years.
✅ State & Local Incentives
No statewide solar tax credit or rebate.
PACE Financing available in participating districts.
Local property tax exemptions may apply (case-by-case).
Sales tax relief possible for large/industrial projects.
Public sector programs (e.g., Entergy's CitySmart) offer efficiency incentives.
✅ Utility Rules & Net Metering
Net metering is being phased out under Act 278:
Grandfathered customers (before October 2024) keep retail-rate net metering for up to 20 years.
New interconnections (after cutoff) receive avoided-cost compensation, not full retail.
System size limits:
Residential: Up to 25 kW or 100% of peak usage (whichever is greater).
Nonresidential: Up to 300 kW (varies by utility).
Smart meters, meter aggregation, and export metering rules vary by utility.
Some co-ops and municipals already apply avoided-cost export rates.
✅ For Nonprofits
Eligible for Direct Pay (cash reimbursement for the ITC).
Can use third-party ownership (e.g., PPA, lease) if not using Direct Pay.
Should stack utility rebates, energy efficiency programs, and grants to improve project economics.
Carefully review utility tariffs to confirm interconnection terms and compensation structure.
Summary
Federal ITC (30%) is the most impactful incentive for Arkansas projects.
No major statewide tax credits or rebates-state support is limited and localized.
Net metering transitions to avoided-cost billing for new customers starting October 2024.
Grandfathered customers retain better export rates-timing is crucial.
Nonprofits benefit from Direct Pay and should evaluate funding sources and utility terms early.