Policy Update 1/8/2013

Net-Meter Backlog Leaves Orleans Parish Solar Residents in the Dark.

Hundreds of completed solar arrays are lounging around on roofs across New Orleans unable to work for residents who have invested in clean energy. Before a residential solar system can be hooked into the grid, the city council must issue a permit and Entergy must install a net metering system in order to measure production and consumption of electricity and charge accordingly. Until this net metering system is installed, the arrays are virtually useless. Some customers are even paying monthly fees on these inactive systems. The Alliance is asking the City Council to address this issue at the City Council Utility Committee meeting next Thursday.
​
Energy Efficiency Docket at the Louisiana Public Service Commission. The new state-wide energy efficiency rules, passed in December are official.  That said, any Commissioner may bring the docket back up on the agenda.  No party filed for reconsideration during the ten-day reconsideration period after the original vote so we are breathing a sigh of relief.
​

Comm. Holloway Threatens Affordability of Solar in the State. Commissioner Holloway is attempting to discourage residents from investing in solar by decreasing the value of the energy produced by these systems.  The current net metering rules are already designed to discourage residents from becoming power producers. Under the current rule, residents pay the retail price of 8 cents/kWh for energy consumed and receive the retail price of 8 cents/kWh for energy produced back into the grid, up until they reach a level of net zero production/consumption. 

After this point, all extra energy produced is sold back to the grid at wholesale price of 3-4 cents/kWh, and can only be collected when the customer terminates their account with the Utility. Holloway would like to change this rule to decrease the affordability even further, so that any energy produced by solar systems, even up to the level of net zero, would be valued at the wholesale price of 3-4 cents/kWh. This change would significantly increase the amount of time it would take for residents to see a return on their investment. This rule change would affect all Louisiana residents outside of Orleans Parish. The Alliance is currently working to prevent this rule change and protect all consumers.
​
The Louisiana Department of Revenue is cracking down on the solar industry. The LDR, responsible for administering state tax credits for solar, has announced that it will finalize their efforts to reinterpret the tax credit law.  The LDR will no longer allow home-owners to install multiple solar systems on their homes.  The state law, which provides a 50% tax credit for residential solar systems, is currently capped at projects with a total cost of $25,000, which is the cost of a 4.1kW system. However, big homes require larger, more expensive projects in order to reach a production level of net zero. For many years, the LDR allowed the installation of multiple projects on a single home. For example, a homeowner could install two 4.1kW systems and receive 2 tax credits for a total cost of $50,000. This change will take effect on January 20th. This issue reveals the flawed design of capping tax credits at a fixed rate that does not reflect the size of the home. A possible solution would be to base the tax credit on the square footage of the home, capping the credit at whatever size would allow the project to reach net zero. The Alliance, GSRIA, consumers, and local solar industries are waiting for the final word from the LDR.

Renewable Portfolio Standard Pilot Project to End in 2013. The state-wide renewable portfolio pilot project, a three year pilot that mandated the development of 350MW of renewable energy in the state, will come to an end in 2013. This pilot successfully brought Louisiana’s energy production to 1% from renewable sources. The Alliance is working to turn this pilot program into a more permanent mandatory renewable portfolio standard, which would create incentives for industry to make long-term investments in renewable energy production.

​