The sun still shines on Louisiana’s solar industry, although perhaps not as brightly after a recent state Public Service Commission decision to change its contentious “net metering” rule.
Despite objections from solar advocacy groups and environmentalists, the changes went into effect Jan. 1, effectively lowering the ROI for residential and commercial owners of new rooftop solar panel systems by reducing the credit they can receive for selling surplus power back to their energy provider.
While the latest rule allows existing solar customers to continue receiving the “retail rate” for excess electricity until 2034, new solar customers can only be credited at the lower “avoided cost” rate. Energy providers say paying the avoided cost is only fair, as it accounts strictly for those expenses directly related to the production of the energy they provide.
Nevertheless, these squabbles over small-scale solar power are missing the point, says David Dismukes, executive director of LSU’s Center for Energy Studies.
“If Louisiana is serious about making big environmental improvements and reducing air emissions, the introduction of large-scale solar fields at the power generation level is the way to go,” Dismukes adds. “You get a far bigger bang for your buck that way, as it’s a huge cost difference on a per unit basis. Those are the things you need to focus on, not all these subsidies for smaller residential applications.”
That’s because electrical power companies are among the biggest users of fossil fuels in the U.S. “It’s only logical that they would take the lead in the promotion of alternative energy sources,” he adds.
Some providers are heeding the call, albeit at a smaller scale relative to their overall energy production. Energy companies are inching into solar power generation, as they work to balance it with the other pressures they face.
Read the full story about Louisiana’s solar industry from the most recent edition of Business Report.
