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Report: Louisiana Solar Subsidies Are Welfare For The Wealthy

Peter Fricke, The Daily Caller on March 03, 2015

A new state report claims that subsidies for rooftop solar panels in Louisiana cost taxpayers millions, and disproportionately benefit higher-income households.

The draft report, prepared for the Louisiana Public Services Commission by professor David Dismukes of Acadian Consulting Group, evaluates the costs and benefits of the state’s solar energy tax incentives, which some industry observers consider “the most generous of any state tax incentives currently allowed in the U.S.”

The subsidies, collectively known as “net energy metering” policies, were originally intended to promote the use of renewable energy sources by allowing individuals to sell excess capacity back to the power grid, thereby reducing the amount of energy they must purchase from electric utilities and offsetting the cost of the energy that they do purchase.

NEM policies were expanded in 2007, when “the Louisiana Legislature created a number of new tax incentives to stimulate in-state solar energy development,” including an income tax credit “equal to 50 percent of the first $25,000 of the cost of each wind or solar energy system.”

Shortly thereafter, Congress passed the Stimulus Act in 2009, which allowed individuals to “claim a credit of 30 percent on the total cost of a residential system,” in addition to any tax credits offered at the state level.

“The combination of federal and state tax incentives,” Dismukes wrote. “[Has] led to a significant increase in the development of … solar NEM installations in Louisiana.” 

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