Louisiana’s solar market presents a baffling study of what happens when market forces come face-to-face with ideology, geography and demographics. Like most of the country, Louisiana has benefited from the more than 40% drop in average PV panel prices last year. By most accounts, this trend will continue despite the US Commerce Department’s proposed tariffs on China’s silicon dumping practices. Consequently, new solar PV installations in Louisiana enjoy payback periods as short as 7 years, making the technology increasingly attractive for businesses and consumers alike.
And yet, the basic tenets of supply and demand remain largely unfelt in the Pelican State. Despite falling PV prices, generous incentives, and growing environmental concerns after the BP oil spill, Louisiana’s solar market sits on the sidelines.
Two factors help to explain Louisiana’s puzzling situation.
First, the state has historically been heavily invested in oil and gas, with nearly 140 active rigs helping to drive Louisiana’s economy. Second, any wholesale embrace of alternative energy sources wouldn’t necessarily include solar within its ranks. Like many of its Gulf neighbors, Louisiana is flush with biogas potential thanks to the region’s active forestry, farming, and milling industries.
Taken together, this access to relatively cheap fuel sources makes it difficult to marshal significant troops behind any comprehensive solar initiaitves. Even Governor Bobby Jindal, who initially signed the state’s Solar Rights Bill, has since joined the chorus of “drill baby drill” – a fact made clear in his March 2012 op-ed to President Obama originally published in the Wall Street Journal.
Blessed (or perhaps cursed) with resources, Louisiana is one of many states that simply doesn’t feel compelled to invest heavily in environmentally safe resources like solar energy. Consequently, Louisiana does not benefit from the outreach and marketing necessary to educate consumers about their options. Incentives and supportive policies exist, but apathy at the state level trickles down into the electorate, thus, obscuring the very tangible environmental, social, and economic benefits of solar adoption at the consumer level.
Some have suggested that Louisiana’s economic layout has something to do with it given the state’s relatively high population of below average income earners. For many in Louisiana, affording solar PV installations is simply not economically feasible. One way to circumvent such obstacles is to adopt new leasing programs, PPAs, and other financing vehicles to help make installation costs more accessible for the average home or business owner.