Entergy Arkansas Go ZERO Tariff

The Entergy Arkansas Go ZERO Tariff exemplifies how a vertically integrated utility can build a voluntary green tariff on SSS principles—leveraging pro rata shares of regulated, existing carbon-free energy (CFE) resources like nuclear and hydro—while enabling customers to achieve granular, time-matched Scope 2 emissions reductions. Launched in August 2023 and updated effective January 2, 2025, the tariff (Rate Schedule No. 41, Go ZERO Rider or GZ) aligns with emerging GHG Protocol guidance on hourly matching and granular certificates. It demonstrates practical integration of SSS into advanced procurement, with opportunities for our Granular Registry to track and trade the resulting attributes for enhanced liquidity and verifiability.

Tariff Purpose and Structure

The Go ZERO Tariff is a voluntary program offered by Entergy Arkansas, LLC (EAL), a subsidiary of Entergy Corporation, targeting large commercial, industrial, and governmental customers under various rate schedules (e.g., Small General Service, Large General Service, and special contracts). Its primary purpose is to provide subscribers with Renewable Energy Credits (RECs) from new renewables and Alternative Energy Certificates (AECs) from emission-free nuclear and hydroelectric resources, enabling alignment of energy usage with zero-emission sources for environmental and sustainability goals.

The tariff is structured around three subscription options, which can be elected individually or in combination:

• Go ZERO 1: Asset-Backed RECs – Focuses on new renewable resources (e.g., solar projects like Chicot Solar, Searcy Solar). Subscriptions start at 1 kW and scale in 1 kW increments, capped at 100% of the customer's annual billed kWh usage.

• Go ZERO 2: Asset-Backed Zero-Emission AECs – Builds directly on SSS by allocating a pro rata (load ratio) share of EAL's legacy nuclear (e.g., Arkansas Nuclear One) and hydroelectric generation, which are regulated cost-recovery resources embedded in standard supply tariffs.

• Go ZERO 3: Time-Match Reporting – Provides granular reporting of hourly load matched to subscribed CFE, combining SSS-based AECs with new RECs for 24/7 carbon-free claims.

Subscriptions are managed via a dedicated Agreement for Go ZERO (Policy Schedule No. 13.26), with annual evaluations to ensure total clean energy attributes do not exceed 100% of usage, preventing over-claiming.

How the Tariff Builds on SSS

SSS refers to default electricity service under regulated tariffs, where customers have a traceable financial relationship to the utility's resource mix (e.g., via integrated resource plans approved by the Arkansas Public Service Commission). Go ZERO operationalizes SSS by:

• Pro Rata Allocation: Under Option 2, customers receive their hourly load ratio share of SSS CFE (nuclear/hydro), calculated as (Customer's hourly load / Total utility load) × SSS CFE output. This ensures "additive and exclusive" claims, where one customer's allocation does not diminish others', aligning with GHG Protocol principles to avoid resource shuffling or double-counting.

• Baseline Integration: SSS forms the foundation, with voluntary additions (e.g., new solar) layered on top. Excess SSS CFE (e.g., from over-generation) is retired for non-subscribers or credited to default rates, preserving equity for all ratepayers.

• Regulated Resource Focus: Nuclear and hydro are treated as SSS-eligible due to cost recovery through standard tariffs, providing low-cost baseload CFE for hourly matching without requiring new builds.

This model prevents customers from "double-paying" for existing clean resources while encouraging incremental procurement, making it a scalable example for utilities in regulated markets.

Matching, Reporting, and Certificate Processes

• Matching Methodology: For time-matched claims (Option 3), CFE is aligned hourly using actual generation data, accounting for grid dynamics (e.g., imports/exports). This supports true 24/7 CFE, with reports combining SSS AECs and new RECs.

• Reporting: Annual Scope 2 emissions are calculated from retail bills, incorporating retired attributes at the aggregate customer level. Preliminary quarterly reports and full annual Time-Match Reports (starting 2024) provide auditable data. Customers can request custom Scope 2 accounting (e.g., 24/7 vs. annual) with at least three months' notice, incurring fees ($105/hour for custom work, plus third-party certification costs).

• Certificate Retirement: RECs/AECs are tracked and retired exclusively on the subscriber's behalf, capped at subscribed load. Third-party certification verifies compliance with quality criteria (e.g., no double-claiming). In practice, tools like M-RETS handle hourly tracking, while CRS guidelines ensure Scope 2 credibility.

Customer Usage for Scope 2 Reporting

Subscribers use Go ZERO to report Scope 2 reductions via verifiable, time-stamped certificates, often blending SSS CFE for baseload coverage with new renewables for gaps. This results in lower market-based emissions, with reports serving as proof for audits, CDP disclosures, or SBTi validations. Examples include:

• LANXESS (Chemicals): Claims full Scope 2 elimination at one site and 82% reduction at others (~66,000 tCO₂e/year avoided), using SSS nuclear/hydro for hourly matching.

• Arkansas Steel Associates: Reports zero Scope 2 emissions by covering 100% usage with time-matched CFE, highlighting SSS as a baseline for carbon-free manufacturing.

• U.S. Federal Government (GSA): Incorporates into federal sustainability reporting for ~185 facilities, aligning with EO 14057 for 100% CFE by 2030 (50% 24/7), reducing Scope 2 via asset-backed certificates.

Billing and Costs

• Charges: A monthly administrative fee (e.g., $0.0005/kWh for Option 1) covers costs, plus any incremental procurement. Custom reporting adds fees.

• Billing: Added as a rider to standard bills, with credits for unsubscribed SSS CFE potentially offsetting rates.

For full details, refer to Entergy's tariff at https://www.entergyarkansas.com/wp-content/uploads/2025/06/eal_gz.pdf or APSC Docket 23-037-TF.