Baton Rouge solar company sees drop in demand

Investing in alternative energy has been touted as a way to spur job growth while developing “green” power sources, but a local solar energy company put half its staff on unpaid vacation due to a drop in demand for solar panel installations, the owner says. Gulf South Solar recently furloughed four workers because business fell off at the start of the year, says Jeff Shaw, founder of the firm and a proponent of solar power in Louisiana. Despite generous tax credits for installing solar panel systems—including a state refund of up to $12,500 per system and a 30% federal refund for the cost—he says many customers wait till the end of the year to make the investment because of the timing of tax season. Shaw, who was pivotal in passing the state’s “net metering” law, which lets consumers sell power back to the electric grid in exchange for utility bill credit, told Business Report in late 2008 that the company had revenue of about $1 million. Last year’s income was better, he says, but demand has plunged in the first quarter. Shaw hopes sales the second quarter will flow as stimulus funds for solar projects get doled out, and he expects cities and parishes to take advantage of a 2009 law that lets municipalities create a “sustainable energy financing district” to pay for the cost of residential solar systems, then charge homeowners property tax increases to pay off the roughly 7% loans over 20 years. “The biggest obstacles with solar are upfront costs,” Shaw says. “If you don’t have home equity to purchase the solar system, you can’t get it.” —Todd R. Brown