Louisiana Public Service Commission Looks to Go Backward on Solar, March 12 Update
The LPSC was slated to consider two rules at their Wednesday, March 12, 9:00 am meeting which could drastically reduce the presence of residential solar in Louisiana. The proposed rules would drastically reduce Net Metering Compensation and could reduce the number of solar systems in each utility.
The LPSC decided again today, March 12, not to decide. For the last year and a half Commissioner Clyde Holloway has threatened almost every monthly meeting with one idea or another to set back our progress for solar net metering, renewable energy or energy efficiency in Louisiana. Many of those times we have had to call on Sierra Club members and allies to call the commissioners offices to voice our support for residential solar in Louisiana. When I called my commissioner Scott Angelle his staff person said they were getting a lot of calls. So we know the commissioners have been hearing from us. Thanks to all who called, your support really matters.
The commission today decided to pass over the agenda items to limit solar but did entertain full discussion. Many of our allies were there to give statements in support of solar. The commissioners did decide to do something that we have been asking for a long time, that is, just do a study. Chairman Skrmetta passed a directive to initiate an RFP (request for proposals) for a consultant to do study of the costs and benefits of residential solar in Louisiana. The study is to be completed by Nov 30, 2014. The current rules on net metering will stay as they are for now. They intend to use the results of the study to set rates for solar so we will be back before the commissioners during that process.
But at this time we cannot drop our attention to this issue. Much will depend on the wording of the RFP that goes out. Commissioner Skrmetta can make sure his wording gets in there. But will the RFP and the study be conducted in a fair and independent way. You can be sure we and our allies will be watching. Thanks again for your calls to the commissioners.
Net Metering Compensation
Currently LPSC allows compensation for the solar power a homeowner produces at a rate equivalent to the rate the utility would charge to sell that power to the homeowner. So if say your utility charges $.085 per Kwh, that is the amount they compensate you for solar power you put back into the grid. That helps you pay off your residential solar system in a reasonable seven to ten year time frame. This is the rate paid to solar owners in most states. But Commissioner Clyde Hollaway, is proposing a rule to compensate you only the utility “avoided cost” rate which would be something like $.025, less than 1/3 the current rate. This would all but destroy the financial incentive for homeowners to install solar in Louisiana.
Rejection of Applications
Under current rules the Commission allows an electric utility to reject applications from homeowners proposing to install solar once the overall percentage of electricity produced from solar in that utility exceeds 0.5%. This limit is overly restrictive when compared to other states. We want LPSC to get rid of this cap. There are several utilities in the state which claim to already be at that cap so they don’t have to accept any more residential solar. But the rule is so vague that it allows them to make this claim with very little justification. The Commission may propose a clarification rule that would actually reduce the number of systems a utility accepts, even under the 0.5% cap.