Ain't No Sunshine When It's Gone: The Future of the Louisiana Solar Initiative After the Demise of the Solar Energy Income Tax Credit

• Author: Michael Seibert
• Position: J.D./D.C.L., 2018, Paul M. Hebert Law Center, Louisiana State University.
• Pages: 705-738

Ain ’ t No Sunshine When It ’ s Gone: The Future of the Louisiana Solar Initiative After the Demise of the Solar Energy Income Tax Credit TABLE OF CONTENTS Introduction .................................................................................. 705 I. Leading the Horse to Water ......................................................... 707 A. Renewables Portfolio Standards ............................................ 709 B. Income Tax Credits ................................................................ 710 C. Net Metering .......................................................................... 711 II. On the Homefront: Louisiana’s Solar Incentives ......................... 712 III. State Survey of Solar Incentives .................................................. 716 A. New York............................................................................... 716 B. California ............................................................................... 720 C. Massachusetts ........................................................................ 724 IV. Don’t Let the Sun Set on Solar ..................................................... 726 A. Solar Energy Benefits ............................................................ 727 B. It’s Not All Sunshine and Rainbows...................................... 728 C. Louisiana’s Plan for the Future .............................................. 733 1. The Tax Credit ................................................................ 733 2. Net Metering and Interconnection Standards .................. 734 3. Renewables Portfolio Standard ....................................... 735 4. Tradable Renewable Energy Credits ............................... 736 5. Administration ................................................................. 737 Conclusion .................................................................................... 737 INTRODUCTION Global climate change is defined as “[a] well-documented rise in global temperatures [that] has coincided with a significant increase in the concentration of carbon dioxide in the atmosphere.” 1 Global climate change is an immediate threat to the future of humanity, 2 and the United Copyright 2018, by MICHAEL SEIBERT. 1. Massachusetts v. EPA, 549 U.S. 497, 504 (2007). 706 LOUISIANA LAW REVIEW [Vol. 78 States Supreme Court has recognized the importance of taking action for its abatement. 3 The effects of global climate change are tangible. 4 Global climate change causes sea levels to rise, affects the already disappearing Louisiana coastline, and increases the likelihood of hurricanes, 5 which cause widespread and catastrophic damage in Louisiana. 6 The emission of greenhouse gases into the atmosphere is a major cause of global climate change. 7 The greenhouse gases release into the air, where they build up in the atmosphere and trap heat from leaving the earth. 8 One-third of greenhouse gas emissions in the United States comes from electricity production. 9 The emissions are a product of the fossil fuel industry’s electricity generation and the extraction, refining, and distribution of oil. 10 In stark contrast, the greenhouse gas emission from the manufacture, installation, and maintenance of renewable energy sources, such as solar power, is minimal. 11 Replacing greenhouse gas-producing electricity 2. Id.; Shannon Baker-Bransletter, Distributed Renewable Generation: The Trifecta of Energy Solutions to Curb Emissions, Reduce Pollutants, and Empower Ratepayers, 22 VILL. ENVTL. L. J. 1, 4 (2011); see also JONATHAN M. HARRIS ET AL., GLOB. DEV. AND ENV’T. INST., THE ECONOMICS OF GLOBAL CLIMATE CHANGE 3 (2015). 3. See generally Massachusetts, 549 U.S. 497. 4. See generally U.S. GLOB. CHANGE RES. PROG., CLIMATE CHANGE IMPACTS IN THE UNITED STATES: HIGHLIGHTS, SOUTHEAST REGION (2016). 5. Id. 6. DAVID ROTH, NAT’L WEATHER SERV., LOUISIANA HURRICANE HISTORY 54 (2010), https://www.weather.gov/media/lch/events/lahurricanehistory.pdf [https://per ma.cc/5QXY-ZCYZ]. 7. One greenhouse gas is “[c]arbon dioxide . . .[, which, when] released into the atmosphere, . . . acts like the ceiling of a greenhouse, trapping solar energy and retarding the escape of reflected heat. It is therefore a species—the most important species—of a ‘greenhouse gas.’” Massachusetts, 549 U.S. at 505; see also Baker-Bransletter, supra note 2, at 4; see also HARRIS ET AL., supra note 2, at 3. 8. Benefits of Renewable Energy Use, UNION OF CONCERNED SCIENTISTS (2013), http://www.ucsusa.org/clean_energy/our-energy-choices/renewable-energy /public-benefits-of-renewable.html#.V9wjFjs4nVp [https://perma.cc/46EK-YALG]. 9. See ENVTL. PROT. AGENCY, EPA 430-R-12-001, INVENTORY OF U.S. GREENHOUSE GAS EMISSIONS AND SINKS: 1990-2010 (2012); see also How much of the U.S. carbon dioxide emissions are associated with electricity generation?, U.S. ENERGY INFO. ADMIN., https://www.eia.gov/tools/faqs /faq.php?id=77&t=11 (last visited Nov. 11, 2017) [https://perma.cc/MG8X-XQET]. 10. RABIA FERROUKHI ET AL., INT’L RENEWABLE ENERGY AGENCY, RENEWABLE ENERGY BENEFITS: MEASURING THE ECONOMICS 34 (2016). 11. See INTERGOVERNMENTAL PANEL ON CLIMATE CHANGE, SPECIAL REPORT ON RENEWABLE ENERGY SOURCES AND CLIMATE CHANGE MITIGATION (Ottmar 2018] COMMENT 707 methods with solar power sources reduces the overall level of greenhouse gases. 12 Many states take initiatives to adopt solar power and incentivize their citizens to do the same. 13 Louisiana’s solar policy incentives increased demand at their outset, but they now fail to sustain solar utilization. The incentives also lack important characteristics that other states have used to increase demand successfully. Louisiana’s solar policies are ripe for change and need to incorporate new policies that have become the national standard. This Comment recommends a policy change in Louisiana’s solar panel incentive structure. Part I provides a background on three solar panel incentive programs. Part II gives an overview of Louisiana’s current solar incentive legislation. Part III surveys three states that have successful solar incentive policy programs, discusses the details of their programs, and analyzes why they have been successful. Part IV elaborates on the benefits provided by solar energy and argues that Louisiana should continue to incentivize solar energy, which will result in lowering the level of Louisiana’s contribution to greenhouse gas emission without impacting the state’s budget. I. LEADING THE HORSE TO WATER Every state incentivizes solar energy adoption. 14 Incentive programs vary greatly among the states and usually are very complicated. The three most influential incentive programs that states offer to increase solar panel demand are renewables portfolio standards, income tax credits, and net metering. Each incentive works uniquely to drive demand for solar energy adoption. Louisiana has chosen to implement some of these incentives, but those incentives often are inadequate. Edenhofer et al. eds., 2012), https://www.ipcc.ch/pdf/special-reports/srren/SRR EN_FD_SPM_final.pdf [https://perma.cc/V8Z8-VM45]. 12. See N.Y. STATE ENERGY PLAN, RENEWABLE ENERGY ASSESSMENT 3 (2009), https://energyplan.ny.gov/-/media/nysenergyplan/final/Renewable_Energy _Assessment.pdf [https://perma.cc/E5UB-C9Q4]; see also Sources of Greenhouse Gas Emissions, U.S. ENVTL. PROT. AGENCY, https://www.epa.gov/ghgemissions /sources-greenhouse-gas-emissions (last visited Sept. 5, 2017) [https://perma.cc/E2 PF-RSNX]. 13. See DATABASE OF STATE INCENTIVES FOR RENEWABLES & EFFICIENCY, N.C. CLEAN ENERGY TECH. CTR. (2016), http://www.dsireusa.org/ [https://perma .cc/596H-PWNU]. 14. Id. 708 LOUISIANA LAW REVIEW [Vol. 78 State solar incentives begin with statewide goals for renewable energy production. 15 States portray these goals in terms of megawatts produced by solar panels in the state. 16 For example, over the next five years, New York will attempt to install 2,910 megawatts of solar electric capacity in addition to the 716 megawatts already installed. 17 A discussion phrased in terms of megawatts is important because the amount of megawatts that a state produces is directly correlative to how many homes the state can power. 18 If solar power can support homes, property owners no longer need to rely on sources that produce greenhouse gases. One study estimates that a single megawatt of solar energy can power up to 164 homes per year. 19 The impact of solar energy becomes apparent in states like California, which has approximately 13,942 megawatts of solar energy production installed. 20 That many megawatts of solar energy can power over two million homes per year—dramatically reducing reliance on energy sources producing greenhouse gases. 21 To reach their goals for megawatt production, states offer incentives to consumers to adopt solar panels and commercial utility companies to derive power from renewable sources. 22 15. See generally What ’ s in a Megawatt?, Solar Energy Indus. Ass’n, http://www .seia.org/policy/solar-technology/photovoltaic-solar-electric/whats-megawatt (last visited Dec. 18, 2017) [https://perma.cc/6ESE-SHXN]. 16. Id. “Megawatts are used to measure the output of a power plant or the amount of electricity required by an entire city. One megawatt (MW) = 1,000 kilowatts = 1,000,000 watts. For example, a typical coal plant is about 600 MW in size.” How is Electricity Measured?, UNION OF CONCERNED SCIENTISTS (2012), http://www.ucsusa.org/clean_energy/our-energy-choices/how-is-electricity -measured.html#.Wa9n8ciGOUk [https://perma.cc/LQ29-444U]. 17. New York Solar, SOLAR ENERGY INDUS. ASS’N, http://www.seia.org /state-solar-policy/new-york (last visited Sept. 5, 2017) [https://perma.cc/2PC8-2DFW]. 18. How many homes can be powered by 1 megawatt of solar energy?, SOLAR ENERGY INDUS. ASS’N, http://www.seia.org/about/solar-energy/solar-faq/how-many-homes-can-be-powered-1-megawatt-solar-energy (last visited Sept. 5, 2017)...