Energy & Environment

Commentary: Long-Term Costs of Renewable Initiatives in Louisiana Must be Carefully Weighed

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Local and State Efforts Now Underway in Louisiana to Test Viability of Renewable Energy

As renewable energy initiatives advance on both the local and state level in Louisiana, a cost-benefit analysis of the potential policy fallout is in order. The Energy Smart program, which offers rebates to participating homeowners and businesses, was approved by the New Orleans City Council last year. The idea here is to heighten efficiency and curb power use so there will be less of a need to build new power plants. The Louisiana Public Service Commission (LPSC) has also approved a statewide pilot program designed to test the viability of renewable energy that will expire in 2014.

While these are seemingly small steps as a matter of policy, they should be viewed within the context of larger national initiatives. In December, Interior Ken Salazar and Secretary of Energy Steven Chu announced the results of  “a comprehensive environmental analysis”  that identified ‘solar energy zones’ on public lands in six western states most suitable for environmentally sound, utility-scale solar energy production.

The detailed study, known as the Draft Solar Programmatic Environmental Impact Statement, was compiled over the past two years as part of the Obama Administration’s efforts to create a framework for a major shift over to renewable energy. Meanwhile, the Environmental Protection Agency (EPA) is moving ahead with anti-emissions regulations. In response to the defeat of “cap and trade” on Capitol Hill, Team Obama has moved aggressively to enact environmental controls administratively. Clean energy proponents in Louisiana claim the emissions controls will boost state efforts to create up to 350 megawatts of long-term renewable power over the next three years.

However, there is now a growing anti-regulatory effort at work on the state level that could potentially unsettle the administration’s plans. New Mexico’s Republican Governor Susana Martinez followed through on her campaign pledge to dismantle environmental regulations earlier this month. She dismantled the so-called “Environmental Improvement Board (EIB), which sought to implement emissions controls without legislative approval and withdraw from the “cap and trade” program advanced under her predecessor. This could have ramifications for the Western Climate Initiative and other state level efforts that target industrial activity.

New Mexico’s actions could help insulate Louisiana consumers and taxpayers, if they catch on in neighboring states.

By Kevin Mooney

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