In an effort to bolster and grow a core of its overall business portfolio—the energy and process industries—Louisiana has overhauled and reorganized related regulatory departments and commissioned its first targeted strategic plan in two decades.
Louisiana Economic Development commissioned the strategic plan, which zeroed in on the energy and process industries as the most lucrative opportunities for the state, according to LED Secretary Susan Bourgeois.
But her team quickly realized that such opportunities take on different forms based upon geography; the needs and offerings of land-locked Shreveport, in the northern part of the state, contrast sharply against the Gulf-hugging, oil-anchored community of Terrebonne Parish.
“So we decided to do a deeper dive and create this energy strategy for Louisiana,” she says.
LED looped in the newly transformed Department of Conservation and Energy, which regulates the industry, to help pave the way. The two departments are now leading what the administration calls its “whole-of-Louisiana” energy strategy.
Louisiana Gov. Jeff Landry restructured both departments—first LED and then C&E—during his first two years in office. The new strategy builds on these realignments, which were carried out through executive orders and legislation.
The first goal is to identify the assets across the state and the priorities of the communities where those assets are located. So if a project needs, for example, easy access to natural gas and a certain amount of open land, LED will be able to tell the company right away where such prospects can be found in Louisiana.
“From a global perspective, Louisiana is already very much on the radar [for foreign investment],” Bourgeois tells LaPolitics. “This is making it more clear and concise: Here’s the most logical place for you, or here are the assets that a particular region can bring to bear. Here’s what both of these state departments will do to align to get your project to market quicker.”
State officials would certainly like to fast-track projects when possible and appropriate. But they also recognize the risk in moving too fast, before residents who live near the proposed project have a chance to understand and get comfortable with what’s approaching.
As such, first-ever C&E Secretary Dustin Davidson meets with potential business operators and asks them if they’ve spoken with local leaders and residents. The last thing he wants is for his department to be working on permit applications for a project and find out that the company skipped this crucial step, which can sow distrust that can lead to opposition.
“If you don’t talk to them, you’re going to have a problem, and it’s not my job to help you,” Davidson says.
The strategy announcement calls for Louisiana to “drill, baby, drill,” an obvious reference to oil and gas. But Bourgeois and Davidson say the new approach also speaks to an “all of the above” approach to energy.
Sure, not everyone wants solar or wind farms in their backyards. But Louisiana still can manufacture the solar panels and the wind turbines, and its workers can build offshore wind facilities, Davidson says.
He notes the oil and gas sector has been shedding jobs for some time. Yet those workforce skills can transfer to other sectors that need welders and other folks who know how to manufacture.
“If it’s going to be built in the United States, why not build it here, right?” Davidson says. “As long as it’s safe, it’s environmentally friendly, and we can do it responsibly, we want to make sure that we can be home to that investment.”
As part of this transition, the Landry administration touts billions of dollars in projects either planned for the state or potentially in the pipeline. However, many of those investments include an element of carbon capture and sequestration, which is controversial in many parts of the state and will be a subject of hot debate during this year’s regular session in Louisiana.
That controversy adds a “unique wrinkle” to the overall strategy, Davidson adds, even if many of the international investments on tap include a CCS component.
While some pockets of the state oppose carbon capture wells, the areas of the state that are used to heavy industry are mostly fine with them, he says.
“At the end of the day, it’s really a question of do those benefits outweigh the impact?” Davidson says “And for those [industrialized] parts of the state, they have decided yes.”
Multibillion dollar data center projects tied to AI also have grabbed headlines over the past several months, and more are expected to be on the way to Louisiana. But many well-informed observers don’t think the current level of investment in AI is sustainable.
So what happens if AI is a bubble that’s about to pop? Bourgeois says every potential project will be weighed carefully to ensure Louisiana is positioned to take advantage of the opportunity while not being burdened with the risks.
Those risks can include other ratepayers being forced to shoulder a project’s energy costs. Bourgeois says the data center boom happened in other states first, so Louisiana has a chance to learn from their mistakes.
“Are we going to announce more data centers? Of course we are,” Bourgeois says. “Are we going to announce an endless number of data centers? No.”
Last week, Gov. Landry, Bourgeois and legislative leaders announced 19 businesses that will get a total of $140 million from LED’s new FastSites revolving loan fund.
The idea is to build “a portfolio of development-ready sites positioned to compete nationally for transformative projects in advanced manufacturing, logistics, energy innovation and next-generation industries.”
Bourgeois says the announcement helps to demonstrate the whole-of-Louisiana approach. The 19 projects are scattered throughout the state, from small towns and rural districts to big cities, she says.
And every loan application required support from state lawmakers from the district, as well as the regional economic development organization, she says. The entire process was built to make sure the local officials and partners were at the table.
