Data Center Site Selection in Arkansas: Entergy, SWEPCO, 2025 Laws and Local Rules

Arkansas offers low-cost power, in-state natural gas and a state government that has moved to attract large loads. The average retail electricity price was 9.59 cents per kWh in 2024, 43rd among the states, and natural gas is the state’s primary source of generation.² Arkansas produces more gas than it consumes, several interstate pipelines cross it toward Midwest and Northeast markets, and gas-fired plants supplied 39% of in-state net generation in 2023.¹⁰

The market is young. After the 2025 energy law overhaul, companies announced five data center projects in the state, and two were under construction by May 2026: Google’s campus in West Memphis and a Serverfarm facility in Clarksville. Google’s planned Little Rock facility was still seeking state and federal wetlands approvals, a reminder that land conditions can set the schedule as much as power.¹¹ For regional context, see our MISO and SPP guides and the neighboring Louisiana, Tennessee and Oklahoma pages.

The first screen in Arkansas is which utility service territory a parcel sits in, because that decides the wholesale market, the planning process and the regulator’s view of cost allocation. Entergy Arkansas, which serves a significant portion of the state, became a MISO member in December 2014. Southwestern Electric Power Company (SWEPCO), Oklahoma Gas and Electric and Empire District Electric are members of SPP, and Arkansas Electric Cooperative Corporation, the generation and transmission cooperative for the member co-ops, belongs to both RTOs.¹

SPP is working through a surge of large-load requests that has outpaced its ability to study them.¹² In January 2026 FERC approved an SPP process that offers an expedited 90-day review to large loads that bring their own generation or pair with existing or planned generation.¹³ On June 18, 2026, FERC also ordered SPP to justify or revise tariff language, citing the risk that large loads could shift costs among transmission customers, with a response due by August 17, 2026.¹² Rates are politically sensitive on both sides: regulators granted SWEPCO a 23% increase for its roughly 126,000 Arkansas customers, and critics tied rising bills to data center growth.¹⁴ Our guide to data centers and electricity ratepayers covers that debate.

Act 373, the Generating Arkansas Jobs Act

Senate Bill 307, the Generating Arkansas Jobs Act of 2025, was signed on March 20, 2025, as Act 373 with an emergency clause.³ Under it, Entergy Arkansas files annual updates that let it begin recovering construction costs for new generation from ratepayers before the projects are finished. Supporters say that lowers financing costs; critics say it rewards spending, and Entergy’s rate filing proposed raising its allowed return on equity to 9.85% from 8.43%.¹⁵ For a site, the practical effect is that utilities have a quicker route to add generation for large new customers, but the cost of that generation is under close public scrutiny.

Act 548 and the data center sales tax exemption

Act 548 of 2025 (House Bill 1444) rewrote the state’s data center sales tax exemption. Its main changes are listed below; sources differ on whether they took effect on July 1 or October 1, 2025, so confirm the current rules with the Department of Finance and Administration and tax counsel.⁴⁷

The act also starts the five-year compliance period when construction begins rather than at occupancy, and extends the exemption to ancillary equipment and services.⁴ Our sales tax exemptions by state guide compares Arkansas with its neighbors.

Google’s $4 billion campus in West Memphis, across the Mississippi River from Memphis, is the template for how Entergy Arkansas serves a hyperscale load. It will be accompanied by a 600 MW solar project that Google is developing with Entergy Arkansas.¹¹ The Arkansas Public Service Commission approved Entergy’s special rate contract for Google on January 29, 2026, in Docket 25-055-P, granted a certificate for the associated solar and battery facility on March 3, 2026, in Docket 25-054-U, and approved a Generating Arkansas Jobs Act rider update on June 12, 2026.⁸

The deal also shows the transparency limits: the public was asked to leave a commission hearing so confidential terms could be discussed. Customers would have paid about $2 a month more for the added capacity, but Entergy says Google agreed to rates that lower costs for other customers.¹¹ Entergy has since proposed a new rate formula and a “Fair Share Plus” initiative meant to ensure data centers pay for the power they use, and says the Google and AVAIO projects will save customers up to $1.7 billion.⁵ Expect any new large load to be offered a negotiated contract with minimum bills and cost-recovery terms; our large-load tariffs guide explains the usual provisions.

Act 851 of 2023 limits local governments’ power to prohibit data centers outright, but it does not stop rules that slow or restrict projects. Cities have used that room: Fayetteville and Little Rock adopted stricter standards, and Fayetteville requires added documentation, compliance with its wastewater pretreatment rules and battery storage instead of generators as the primary backup power source.⁶ Little Rock’s board approved its industrial zoning changes after residents asked for a moratorium instead.¹¹

Counties have gone further. In May 2026 the Pulaski County Quorum Court approved a yearlong moratorium but narrowly exempted AVAIO Digital’s planned data center near Wrightsville; the county attorney questioned whether the pause was legal under the 2023 law, while supporters argued a time-limited pause is not a ban.⁹ By August 2026 Madison County had passed a three-year moratorium, joining four other counties with pauses, and only Independence County’s pause was longer. Efforts to amend the 2023 law had not advanced, including in the April 2026 fiscal session.⁶

• Check county quorum court and city council minutes for any active or proposed moratorium.
• Read the city’s industrial or data center zoning standards for backup power, wastewater and documentation rules.⁶
• Treat the legal status of time-limited county moratoriums as unsettled and confirm it with Arkansas counsel.⁹

See our guide to data center moratoriums and local restrictions for how these pauses usually end.

1. 01Identify the serving utility and whether the parcel is on the MISO (Entergy Arkansas) or SPP (SWEPCO, OG&E, Empire) side.¹
2. 02Ask the utility whether new generation would be needed and how it would be recovered under Act 373.³¹⁵
3. 03On the SPP side, ask whether pairing the load with generation could qualify for SPP’s expedited 90-day review.¹³
4. 04Test the project against Act 548’s $100 million and $2 billion investment tiers and their payroll tests.⁴⁷
5. 05Check for county moratoriums and city zoning rules before signing a land option.⁶
6. 06Screen wetlands early, as Google’s Little Rock site shows.¹¹

Two points deserve early attention. First, Arkansas large-load deals have so far been negotiated contract by contract, so a developer should expect the utility to ask for load evidence, a ramp schedule and financial commitments before it plans new generation, and should expect those terms to be reviewed in a public docket, partly in confidential session.¹¹ Second, county politics can change faster than state law: a site that is open today can be paused by a quorum court vote within weeks, so local outreach belongs at the start of diligence, not after the power study. Our wetlands guide covers the permit track Google’s Little Rock site is working through. If you want an independent read on a specific tract, you can get a site reviewed.