LITTLE ROCK, Ark. – Six Arkansas electric cooperatives have defended the requirement for homeowners on their networks to pay connection fees and carry additional insurance if they want to use an alternative energy source.

The insurance and fees, the cooperatives stated in a Thursday release, were due to the federal government loans that provide for electrical grid equipment. The cooperatives stated that the equipment must be insured against possible damage to meet the loan requirements.

Federal low-cost loans are typical to provide equipment for rural utility services.

Homes with solar panels or wind generators use a net metering electric meter to connect to the electrical network. The meter essentially takes any excess power generated and returns it to the electric grid, crediting the home or business owner.

In the Thursday release, the cooperatives stated the insurance amount was due to possible “back feed,” which could damage a system.

“Like it or not, an array of solar panels or a wind turbine are electricity generating systems that have the potential to be very dangerous. If something goes wrong and they improperly back feed over the grid, they can cause serious damage to Uncle Sam’s [loan] collateral (things like transformers and substations), they can start fires, and worst of all they can cause death or serious injury to cooperative linemen and contractors.”

Arkansas electrical cooperatives Sept. 15 press release

A recent Working 4 You investigation spoke with a Shirley man who wanted to use solar panels on his home to lower his energy bill. His service provider, Petit Jean Electrical Cooperative, required him to pay a $500 fee and carry $1 million in insurance, plus purchase additional equipment, making the addition of solar panels cost prohibitive.

The Arkansas Public Service Commission has begun investigating the insurance and fee requirement for alternate energy of state electric cooperatives, which may run counter to state statutes.

The commission had no comment about the Friday electric cooperatives letter and its defense of the practice, citing federal law. Arkansas PSC chairman Ted Thomas recently submitted his resignation while indicating frustration with resistance to alternative energy by some state power utilities.

“The state’s solar policy is under attack,” Thomas said about his resignation.