# D004 Antithesis — UFEEPA findings are UFEEPA findings, not (10)(A) findings ## Counterclaim Order No. 9 is a UFEEPA CECPN grant. It is litigated under UFEEPA's procedural rules, decided under UFEEPA's seven-factor evidentiary standard codified at § 23-18-519(b), and resolves a UFEEPA question — "is the major utility facility needed and will it serve the public interest, convenience and necessity?" — on a UFEEPA record. The order's 55 pages contain **zero** references to "Strategic Investment," **zero** citations to § 23-4-1303 or § 23-4-1304, and the **only** mention of Act 373 in the entire order is a single incidental citation noting that Act 373 repealed a now-obsolete deficiency-letter provision in former § 23-18-514(b)(1). The thesis would have the Commission retroactively re-label Order No. 9 a Strategic Investment designation — converting UFEEPA findings into Act 373 findings by post-hoc semantic equivalence, on a record where the parties never litigated under Act 373, were never on notice that Act 373 findings were being made, and never had the opportunity to contest a (10)(A)-purposes designation under the procedural protections of the framework actually being applied. That is not statutory construction; it is statutory laundering. Ironwood must be excluded from the 2026 rider — $33.9M of EAL's $110.4M requested revenue requirement — until a discrete designation finding is made on a record specifically addressed to the (10)(A) purposes. ## Attack on the thesis The thesis section **"The (w) recovery-eligibility test is satisfied condition-by-condition; nothing in the statute requires more"** loads the entire argument onto subsection (w) and then quietly assumes (w) does work it does not do. Subsection (w) is titled, within § 23-4-1304, *"Authorization to recover strategic investments through rider"* — it is a **recovery-eligibility** provision, not a **designation** provision. Its grammatical subject is "An expenditure associated with strategic investments" — i.e., an expenditure that is *already a strategic investment* under § 23-4-1303(10). It does not say "an expenditure that *would be* a strategic investment if approved" or "any qualifying expenditure shall be deemed a strategic investment." It presupposes the resource is a Strategic Investment and then tells you when its costs may flow through the rider. Reading (w) to confer Strategic Investment status on resources that otherwise do not meet (10)(A) collapses the statutory architecture: the definitional section (§ 23-4-1303(10)(A)/(B)) is rendered redundant for any pre-Act-373 resource because (w) would do all the definitional work. The Legislature does not pass dead-letter definitional provisions; it draws a sharp distinction between *what is* a Strategic Investment (the definitional section) and *which Strategic Investments are rider-eligible* (the recovery-mechanism section). The thesis erases that distinction. The thesis section **"The (10)(A) chapeau requires Commission approval under one of four enumerated approval pathways — Order No. 9 is exactly that"** ignores the chapeau's "to:" clause as a substantive requirement. The chapeau reads: "approved by the Arkansas Public Service Commission under [pathway], **to:** [four purposes]." The "to:" is a **purpose-clause**, not surplusage. It defines *which approvals count*: not every approval under one of the four pathways, but approvals **made for** one of the four enumerated public-interest purposes. The thesis's reading — that any CECPN approval automatically counts because § 23-3-201 et seq. is an enumerated pathway — would render the four-purpose clause meaningless. Every CECPN order ever issued by the Commission would automatically become a Strategic Investment designation by operation of law, regardless of what the order actually analyzed or found. That is absurd. The "to:" clause requires the approval be **for** one of the four purposes — meaning the order's findings, on its own record, must engage those purposes as the basis for the approval. Order No. 9's findings engage UFEEPA's purposes (siting, environmental compatibility, alternative analysis, regional needs), not Act 373's four purposes (economic development, reliability, nuclear license extension, dispatchable generation adequacy). The overlap in substantive vocabulary is coincidental — the legal standards, evidentiary burdens, and required findings are distinct. The thesis section **"Order No. 9's substantive findings on reliability and dispatchable generation satisfy (10)(A)(ii) and (10)(A)(iv) directly, on the merits"** misreads the order's own framing. The order's "reliability" and "dispatchable" language is **explicitly anchored to UFEEPA § 23-18-519(b)(2)**, not to § 23-4-1303(10)(A). The order says verbatim at page 26 (immediately after the "even without the IRP evidence, the undersigned finds that EAL will have an immediate need for a peaking resource" finding the thesis quotes): "**Ark. Code Ann. § 23-18-519(b)(2) requires a finding that EAL's proposed LC5 is a reasonable resource to fill that need**" (Order No. 9 p. 26). That is the legal standard the order is applying. It is not § 23-4-1303(10)(A)(ii)'s "maintain and improve the provision of reliable electric utility service." It is UFEEPA's "reasonable resource to fill that need" — a different standard with different burdens, different evidentiary requirements, and different procedural protections. The thesis quotes the order's factual findings out of context, snips them from their UFEEPA legal-standard anchor, and reattaches them to the (10)(A) framework — which the order does not invoke, does not cite, and was not litigated under. The thesis section **"The 'approval order doesn't say Strategic Investment' objection misreads § 23-4-1304(w) entirely"** invents a "transition-window" intent the Legislature did not write. The thesis claims (w) was "designed precisely for the situation Ironwood occupies" — a pre-Act-373 CECPN application whose approval order does not use post-Act-373 vocabulary. But the actual text of (w) does nothing of the kind. It does not provide that pre-Act approval orders are deemed Strategic Investment designations. It provides that pre-Act applications, *if approved* and *if the costs are not otherwise included in rates*, are eligible for rider recovery. The (w) text is silent on whether the approval order must itself make Strategic Investment findings, or whether a separate designation finding is required, or whether (10)(A)'s purposes prong is implicitly satisfied. The thesis's "of course a pre-Act order won't use post-Act vocabulary" argument proves too much: by that logic, the Commission could rubber-stamp any pre-Act-373 CECPN as a Strategic Investment without ever actually making the (10)(A) findings, simply by pointing to (w). That is not transition-bridging; it is grandfathering by judicial fiat. The Legislature could have written "any approval order entered after January 1, 2025, on a pre-Act application shall be deemed a Strategic Investment designation." It did not. Finally, the thesis section **"The policy stakes confirm the textual reading"** asks the Commission to find substantive merit in EAL's prior procedural moves — the September 2025 Notice of Intent to Include in GAJA Rider, the September 2025 bill-impact directive. But the Commission's own framing rebuts this. In [[Order No. 6 Legislative Council Report]] of 26-008-TF, issued **2026-05-12** by the full Commission, the order opens with: *"assuming Commission approval of the most recent Annual Update filing"* (Order No. 6 p. 1, emphasis added). If the Commission believed Ironwood had already been designated a Strategic Investment by Order No. 9 of 24-072-U, no "assuming" qualifier would be needed. The Commission itself, in its most recent order in the GAJA Rider docket, treats the substantive Ironwood-inclusion question as **unresolved**. The thesis cannot have it both ways: it cannot simultaneously claim Order No. 9 already designated Ironwood as a Strategic Investment and explain why the full Commission, fourteen months later, was using "assuming" language about whether the Annual Update would be approved. ## Independent argument for the counterclaim **The structural asymmetry between UFEEPA and Act 373 matters because the statutes do different work.** UFEEPA (§ 23-18-501 et seq.) is a **siting and environmental review** statute. Its seven-factor framework at § 23-18-519(b) requires findings on: (1) basis of need for the facility; (2) public interest, convenience and necessity; (3) environmental impact; (4) impact on aesthetics, scenic beauty, historic sites, parks, recreational areas, wildlife; (5) impact on local economy and society; (6) site reasonableness; (7) public services; and so on. Its purpose is to ensure that the **physical siting and construction** of major utility facilities serves the public interest. Act 373 (§ 23-4-1303(10) and § 23-4-1304) is a **rate-recovery designation** statute. Its purpose is entirely different: to identify certain investments as eligible for accelerated, single-issue rider recovery outside the base rate case, with the four (10)(A) purposes serving as the substantive gatekeeping criteria. These are not the same legal regimes. They have different evidentiary burdens (UFEEPA: comprehensive multi-factor balancing; Act 373: targeted purpose-specific findings), different procedural protections (UFEEPA: full evidentiary hearing with intervenors litigating the full record; Act 373: a designation finding the parties are on notice they are litigating), and different consequences (UFEEPA: permission to build; Act 373: permission to recover through a rider that bypasses the protections of the base rate case). Conflating the two — treating UFEEPA findings as Act 373 findings — denies the parties the procedural protections of whichever framework they did not actually litigate under. **The Commission's own practice in Cypress and Jefferson is dispositive evidence that designation is a discrete act.** [[Cypress Order No. 4 CECPN Approval|Cypress Order No. 4]] (2026-03-03) — issued **after** Order No. 9 — contains a dedicated Section F titled verbatim **"Strategic Investment Findings Required under Ark. Code Ann. § 23-4-1303(10)(A)-(C)"** at p. 54. That section reproduces the (10)(A) chapeau text in full, reproduces (10)(B)(ii)'s 100-MW per se inclusion clause, reproduces (10)(C)'s renewable-resource provisions and (10)(C)(ii)'s six-factor benefits test, walks through the parties' testimony on each, and concludes: *"Based on the Parties' testimony, the Commission finds that the Cypress Solar Project qualifies as a strategic investment under § 23-4-1303(10)(A)-(C)"* (Cypress Order No. 4 p. 56). That is what a Strategic Investment designation looks like when the Commission means to make one. Order No. 9 has nothing remotely analogous — no Section F, no quotation of (10)(A), no walk-through of the parties' testimony on the (10)(A) purposes, no Commission conclusion that LC5 "qualifies as a strategic investment under § 23-4-1303." [[docket-25-047-u-jefferson-2026-05-22/_overview|Jefferson Order No. 5]] is even more explicit: it characterizes Jefferson as *"the first proceeding before the Commission where EAL is **explicitly seeking to establish** a generation facility (and associated transmission infrastructure) as a strategic investment eligible for rider recovery pursuant to Act 373"* (Jefferson Order No. 5, per [[docket-25-047-u-jefferson-2026-05-22/_overview|Jefferson production overview]]). "**Explicitly seeking to establish**" — language that distinguishes Jefferson from prior CECPN dockets, including, by direct implication, Ironwood's 24-072-U. The Commission, in its own words, treats Jefferson (and by parallel, Cypress) as proceedings where Strategic Investment status is **affirmatively litigated and decided**. Ironwood was not such a proceeding. **The procedural-protection argument is decisive.** Parties in 24-072-U — AEEC, the Attorney General, Staff witnesses Martin and Bower and Lockwood, Norwood (for AG) — litigated under UFEEPA. They contested EAL's IRP assumptions, the alternatives analysis, the seven UFEEPA siting factors, the environmental impact, and the reasonableness of LC5 as a peaker replacement. They did not litigate, were not asked to litigate, and had no notice that they should litigate, whether LC5 qualifies as a Strategic Investment for purposes of (10)(A)'s four-purpose test or whether the (10)(B)(i) 100-MW per se inclusion applies. Order No. 9 was entered April 18, 2025 — barely four weeks after Act 373's March 20, 2025 signing. The parties had no opportunity to develop a record specifically addressed to the (10)(A) purposes. If the Commission now declares Order No. 9 to have been a Strategic Investment designation, it deprives those parties — particularly AEEC, the Attorney General, and ratepayer interests — of the right to contest the designation under the framework actually being applied. That is a due-process problem under Arkansas administrative law: agency action must be on notice and on the record. Designating Ironwood retroactively on a UFEEPA record is the opposite of both. **The Commission's "assuming Commission approval" framing in [[Order No. 6 Legislative Council Report|Order No. 6 of 26-008-TF]] is a textual admission.** Issued by the full Commission (Webb, Tate, Anderson) on 2026-05-12 — **after** Order No. 9 of 24-072-U, **after** EAL's Notice of Intent to Include, **after** the September 2025 bill-impact directive, **after** the April 29, 2026 evidentiary hearing — the order frames its directive to EAL as conditional on "Commission approval of the most recent Annual Update filing." A Commission that believed it had already designated Ironwood as a Strategic Investment in April 2025 would not, fourteen months later, frame the question as still requiring "approval." The framing is the Commission's own admission that the substantive Ironwood-inclusion question — and by necessary implication, the Strategic Investment designation question — remains open. The thesis has no answer to this textual admission except to wave it aside as procedural housekeeping. It is not. It is the Commission's most recent statement on the matter, and it is unambiguous: the question of whether Ironwood is properly in the GAJA Rider remains unresolved. **The financial stakes confirm the legal posture, but in the opposite direction from the thesis.** Acting Staff witness Herring's recommendation would reduce EAL's filed revenue requirement by **$33.9 million** (Staff's full reduction, including the $463,000 rate-of-return correction, is $34,354,730) — a reduction of approximately 31% of the rider's annual collection. That is real money flowing from Arkansas ratepayers into a rider whose statutory predicate has not been established. The thesis says the policy stakes "confirm the textual reading" by counseling against a "procedural technicality" excluding a needed reliability resource. But the Arkansas administrative-law concern runs the opposite direction: ratepayer money should not flow through a statutorily-mandated designation process by inference, by retroactive re-characterization, or by treating UFEEPA findings as substitutes for Act 373 findings the Commission has not made. The Legislature's careful procedural architecture — the (10)(A) chapeau, the four-purpose clause, the (w) recovery-eligibility test that presupposes (10)(A) designation — exists precisely to constrain ratemaking discretion. Reading those constraints out of the statute to permit $33.9M of rider recovery without a designation finding nullifies the protections the Legislature built. The remedy is straightforward: the Commission should deny 2026 recovery for Ironwood, and EAL — if it believes LC5 qualifies — should ask for a designation finding on a record specifically addressed to the (10)(A) purposes, in 26-008-TF or another proceeding. Staff itself "would not object" to such a finding being made (Herring Direct p. 9). The path forward is procedurally clean; the thesis's path is statutorily forbidden. ## Evidence - **Order No. 9 contains zero references to "Strategic Investment" (Tier 1):** A full-text search of `D:\ar-data-centers\extracted\psc\docket-24-072-u-order-9-2026-05-24\24-072-U_152_1.txt` (55 pages) returns **zero** occurrences of "Strategic Investment" or "strategic investment," and **zero** citations to § 23-4-1303 or § 23-4-1304. The order's analytical scaffolding is UFEEPA throughout (see [[docket-24-072-u-order-9-2026-05-24/_overview|Ironwood Order No. 9 CECPN Grant]]). - **The order's "reliability" finding is explicitly a UFEEPA § 23-18-519(b)(2) finding (Tier 1):** "Having concluded that there is a need for a replacement peaking resource, **Ark. Code Ann. § 23-18-519(b)(2) requires a finding that EAL's proposed LC5 is a reasonable resource to fill that need**" (Order No. 9 p. 26, line 888-890 of extracted text). This is the legal standard the order is applying — UFEEPA's "reasonable resource to fill that need," not § 23-4-1303(10)(A)(ii)'s "maintain and improve the provision of reliable electric utility service." - **The order's only reference to Act 373 is incidental (Tier 1):** "Staff witness Susan Lockwood... testified that Staff did not issue a deficiency letter pursuant to Ark. Code Ann. § 23-18-514 (b)(1) (now repealed by Act 373 of 2025)" (Order No. 9 p. 8, line 277-278 of extracted text). This is the order's **sole** engagement with Act 373, and it concerns a repealed procedural provision, not the Strategic Investment framework. - **The (10)(A) chapeau's "to:" clause is a substantive requirement (Tier 2):** "'Strategic investments' means investments... approved by the Arkansas Public Service Commission under [pathway], **to:** (i) Support growth and economic development... (ii) Maintain and improve the provision of reliable electric utility service... (iii) Support the license extension for existing nuclear generation resources; and (iv) Ensure that electric utilities maintain adequate dispatchable generation resources..." (Act 373 of 2025, § 23-4-1303(10)(A); primary public record, [Act 373 archive](../../../web%20archive/2026-05-24/arkleg.state.ar.us/act-373-of-2025.md)). The "to:" clause defines which approvals count — not every CECPN, but CECPNs **made for** one of the four enumerated purposes. - **Cypress Order No. 4 has a dedicated Section F on Strategic Investment Findings (Tier 1):** Section F is titled verbatim "**Strategic Investment Findings Required under Ark. Code Ann. § 23-4-1303(10)(A)-(C)**" (Cypress Order No. 4 p. 54, line 1818-1819 of extracted text). Section F reproduces the (10)(A) chapeau text in full, walks through (10)(B)(ii)'s 100-MW per se inclusion clause, walks through (10)(C)'s renewable-resource framework, walks through (10)(C)(ii)'s six-factor benefits test, and concludes: "**Based on the Parties' testimony, the Commission finds that the Cypress Solar Project qualifies as a strategic investment under § 23-4-1303(10)(A)-(C)**" (Cypress Order No. 4 p. 56, line 1931-1932 of extracted text). Order No. 9 has nothing analogous; see [[Cypress Order No. 4 CECPN Approval]]. - **Jefferson is "explicitly seeking to establish" Strategic Investment status — Commission's own framing (Tier 1):** "This Docket is the **first proceeding before the Commission where EAL is explicitly seeking to establish a generation facility (and associated transmission infrastructure) as a strategic investment eligible for rider recovery pursuant to Act 373**" (Jefferson Order No. 5, Doc. 60, 2025-08-27; quoted in [[docket-25-047-u-jefferson-2026-05-22/_overview|Jefferson production overview]]). "Explicitly seeking to establish" is the Commission's own language distinguishing Jefferson from prior CECPN dockets including, by direct implication, Ironwood's 24-072-U. - **Order No. 6 of 26-008-TF uses "assuming Commission approval" language (Tier 1):** "**assuming Commission approval of the most recent Annual Update filing**" (Order No. 6 of 26-008-TF p. 1, full Commission, 2026-05-12; see [[Order No. 6 Legislative Council Report]]). The full Commission, fourteen months after Order No. 9, treats Ironwood's inclusion as a still-pending approval question. If Order No. 9 had designated Ironwood, no "assuming" qualifier would be needed. - **Staff's principal objection — no Strategic Investment finding has been made (Tier 1):** "**Despite the Company's acknowledgement that the purpose of the GAJA Rider is to recover from retail customers EAL's costs associated with strategic investments as defined under Arkansas law and as designated by the Commission, the Commission has not made a finding that Ironwood is a strategic investment nor that EAL has the authority to allocate 100 percent of the costs of Ironwood to retail customers as a strategic investment**" (Herring Direct p. 6, see [[APSC Staff Testimony on the GAJA Rider]]). - **Staff attribution of the gap — Order No. 9 did not address designation (Tier 1):** "**Order No. 9 granting the CECPN for Ironwood did not address whether Ironwood should be designated as a strategic investment**" (Herring Direct pp. 6-7, see [[APSC Staff Testimony on the GAJA Rider]]). - **Cypress was designated under § 23-4-1303(10)(C) (Tier 1):** "Cypress Solar is designated a Strategic Investment under **Ark. Code Ann. § 23-4-1303(10)(C)** (renewable resource clause)... The battery portion is a new dispatchable resource" (see [[Cypress Order No. 4 CECPN Approval]] Strategic Investment designation section). Designation cites a specific subsection of § 23-4-1303(10); Order No. 9 cites no subsection. - **UFEEPA's seven-factor framework structures the entirety of Order No. 9's substantive analysis (Tier 1):** 13+ citations to § 23-18-519(b) and its subparts appear in Order No. 9, including the order's Table of Contents: "Required Commission findings pursuant to Ark. Code Ann. § 23-18-519(b) . 18" (Order No. 9 line 66 of extracted text). The order's analytical architecture is UFEEPA from page 18 through the conclusions; § 23-4-1303 / § 23-4-1304 is the framework that **is not there**. - **The $33.9M financial stake (Tier 1):** "**Excluding Ironwood** reduces the revenue requirement by approximately **$33.9 million**" (Herring Direct p. 8, see [[APSC Staff Testimony on the GAJA Rider]]). Combined with the $463,000 rate-of-return correction, Staff's recommended revenue requirement is **$76,085,812**, a reduction of **$34,354,730** from EAL's filed $110,440,542. - **Section 23-4-1304(w) presupposes — does not confer — Strategic Investment status (Tier 2):** "**An expenditure associated with strategic investments** for which an application for approval is pending before the commission as of the effective date of this subchapter **shall be eligible for recovery through the rider** under this subchapter if: ..." (Act 373 of 2025, § 23-4-1304(w); primary public record, [Act 373 archive](../../../web%20archive/2026-05-24/arkleg.state.ar.us/act-373-of-2025.md), emphasis added). The grammatical subject is "an expenditure associated with strategic investments" — i.e., expenditures that are *already* Strategic Investments. The verb "shall be eligible for recovery through the rider" addresses recovery mechanics, not designation conferral.