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Preheat oven to 350 degrees F. Lightly grease a large baking dish.
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In a medium saucepan over medium heat, melt the butter and saute the green onion until tender (about 3 to 4 minutes). Add the garlic powder, then stir in the can of green chiles, cream of chicken soup and sour cream. Mix well. Add the chicken, 1/2 cup of shredded Cheddar cheese and milk. Stir together. Heat until cheese melted.
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Combine the rice and cheesy chicken mixture. Transfer to the baking dish and top with remaining cheese.
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Heat in the oven for 20 minutes, or until cheese is melted and bubbling.