Two pieces of legislation that could slow solar development in Louisiana moved forward at the State Capitol Wednesday. A House resolution and Senate bill both advanced out of committees without opposition.
House Concurrent Resolution 40 by House Speaker Clay Schexnayder, R-Gonzales, would block solar projects from being eligible for industrial tax breaks until July 10, and Senate Bill 185 by Sen. Bret Allain, R-Franklin, would delay the implementation of the solar lease program until a funding source is identified to staff two positions at the state Department of Natural Resources for oversight of solar leases.
Joe Mapes, a lobbyist with the Louisiana Farm Bureau, testified in support of both pieces of legislation. He said that farmers are concerned that solar developers will outbid them on leasing land. “90% of our farmers in Louisiana are tenant farmers,” he said. “Now, you can have a family farm in West Baton Rouge, for example, that’s been farming a piece of property for many years, decades and then all of a sudden they have no place to farm at all.”
Allain’s bill would task the Department of Natural Resources with promulgating rules for solar leases, including maintenance of the property during the lease, decommissioning and final site closure upon termination of the lease. Allain said his bill was aimed at preventing solar farms from going the way of abandoned oil wells, which lack adequate funding to be plugged and cleaned up. “My fear is that if we don’t weigh in on how these leases are to happen that we will end up with orphan solar farms across the state,” he said.
Rules around solar development, such as decommissioning bonds, have already been worked out in other states, said Stephen Wright, the executive director for the Gulf States Renewable Energy Industries Association. “GSREIA hopes that the Department of Natural Resources will partner with us to avoid unnecessary delays on potential projects that could take investments to other states,” he said.
HCR40 would block solar projects from benefiting from the state’s Industrial Tax Exemption Program, which exempts major industrial projects from most property taxes for as long as a decade. During a Senate Commerce, Consumer Protection and International Affairs Committee meeting Wednesday, Sen. Karen Carter Peterson, D-New Orleans, asked what the bill was trying to accomplish.
“I thought we were trying to promote more solar projects. So, help me out,” Carter Peterson said. Members of the Louisiana Farm Bureau have questioned whether solar farms should receive ITEP “since the ITEP program is primarily created for projects that create jobs and stimulate economic activity,” said Mapes, who introduced the bill for Rep. Schexnayder. “So, we wanted to slow it down and look at that.”
Under current rules, parishes can reject ITEP applications for projects that don’t create jobs, Carter responded. “It’s inconsistent with where we’re going to try to single out solar developers and solar projects,” she said. “They can just reject it on their own without this resolution.”
A 2020 Ohio University study found that utility-scale solar projects could create thousands of direct and indirect jobs. Louisiana could benefit from similar levels of growth, Wright said.
Amendments added to the resolution could soften the impact to solar development. One amendment changed the language of the resolution from “direct” to “urge and request” that ITEP be suspended for solar development. The resolution was also amended to put a deadline on the suspension to end 30 days after the regular legislative session.
While renewable energy advocates saw the amendments as a positive change, they remained concerned about the message the legislation sends to renewable developers. “We have been disappointed but not surprised to see Louisiana legislators looking to block clean energy development,” said Logan Atkinson Burke, the executive director of the Alliance for Affordable Energy. “This is only hurting Louisiana and holding us back from joining the renewable and efficient economy that the rest of the country is moving on.”
The resolution also sends a message to those who are breathing in pollution from energy derived from fossil fuels, Carter Peterson said. “It’s just a horrible message when we have Cancer Alley here in Louisiana,” she said. “It doesn’t make sense to send this message, even in the urge and request.”