Louisiana Solar Industry Responds to Unorthodox Solar Net Metering Study

Study Seen as Incomplete and Unfocused, Manner of Release Called into Question

Mar 10, 2015, 16:19 ET from Gulf States Renewable Energy Industries Association

BATON ROUGE, La., March 10, 2015 /PRNewswire/ -- The Louisiana Solar Industry responded today to release of an unorthodox study of solar net metering by the Louisiana Public Service Commission. Net metering is the program in which home and business owners produce energy from solar systems for use onsite, and receive credits from the utility monopoly for any energy returned to the grid. The study is several months overdue and has been marred by controversy from its inception, with a consultant selection process that was defined by unusual circumstances and hidden information.

"This study is a distortion of the truth, an assault on consumer energy choice and property rights by the monopoly utilities and certain allies on the Commission," said Jeff Cantin, president of the Gulf States Renewable Energy Industries Association. "Monopolies don't like competition, and the state's utility monopolies would like to mistreat their solar customers as wholesale power plants. Unfortunately for our citizens, Louisiana has some of the highest bills in the region. If monopoly utilities have their way in coming months, Louisianans will soon become completely captive to these bills, without the right to self-generate their own energy on their own private property for their own use," says Cantin. "While many energy businesses are shedding jobs, solar is putting more people to work day after day, across Louisiana, serving hard-working families as employees and as customers."

The Acadian study has been flagged by industry experts for its inconsistencies, including missing significant data. For instance, Acadian's analysis factors in costs of solar without assessing benefits, and doesn't refer to the fact that In Louisiana solar has created 1,200 direct jobs and hundreds more indirect jobs, according to a recent study by The Solar Foundation.

In addition, the Acadian study omits well-known data that says total savings and new consumer spending generated from just the private solar investments and installations in the past five years will surpass $400 million during the 30 year lifespan of the solar panels. It also ignores the fact that venture capitalists have invested more than $40 million in private funding into Louisiana solar firms.  

The study also neglected to include the admission by Entergy that it plans to pass on the cost of $2 billion in new power plant investments to ratepayers in order to meet the needs of Louisiana's industry expansion over the next few years. Nor does it mention that Entergy is guaranteed a nearly 10 percent profit on all investments.

Another example of the study's tortured efforts to put solar in a negative light, the report references several well-known studies with highly beneficial conclusions for solar energy, yet the Acadian report varies so greatly from these other studies that its intentions have been called into question. "How can you refer to a study for nearby Mississippi, with nearly the same power generation profile, showing solar as a net benefit to consumers and ratepayers, then turn those results on their head and claim the opposite? Something doesn't smell right here," Cantin said.

Among other problems with the study's integrity and even the process of selecting the consulting firm itself, the following errors were observed in its analysis:

  1. The release of the draft study in March during legislative budget hearings, several months overdue, is highly questionable.
  2. The study mistakenly asserts that a state tax credit is a cost to a utility (P 111, Fig. 37) when it is not. 
  3. The report is outside of scope for a cost benefit analysis of net metering, as directed by the PSC. In addition, the RFP scope for the Net Meter cost/benefit study did not include using the tax credit as a cost benefit.
  4. The report cites a study by Crossborder in 2013 (p 80 of Acadian) which found "zero" net metering cost but then projects out 35 years of NEM costs (p 143) based on two peak years of increased customer adoption (2012-2013).
  5. The report does not take into account the phase out of solar leasing beginning mid-2013, nor the Department of Revenue's improvement of credit efficiency, and single systems beginning 2014, which have already taken place.
  6. In 15 cost/benefit studies done by experts over the last 7 years, not one included their state subsidies.

According to industry insiders, Acadian never contacted any of the solar energy companies for data or input. This fact is highlighted by its conclusions on income disparity in solar benefits. That conclusion appears to have omitted research on leasing-model solar firms, for whom more than 85% of solar customers live in census tracts below the median income.

GSREIA finally notes that the Louisiana economic development incentive for solar energy was shown in a 2013 study by economist James Richardson to return 108% of its cost back to the state in increased state revenues.

The solar industry has worked to ensure that fair solutions are reached to cover any costs of solar energy to the state's infrastructure while acknowledging the high value of solar energy in peak hours. "While most other states, such as conservative-led South Carolina and Georgia, are trending toward expanding their net-metering and solar energy infrastructure, Louisiana cannot afford to move in reverse on this important new global industry," said Cantin.

The Gulf States Renewable Energy Industries Association is a non-profit trade association representing Solar and Renewable Energy companies and consumers throughout Louisiana, Mississippi, and Alabama in matters of policy, regulation, and public relations. It is a locally operated chapter of the Solar Energy Industries Association.

For more information, visit www.gsreia.org.




SOURCE Gulf States Renewable Energy Industries Association