Energy

Solar Lobbyist Whines That His Subsidized Panels Aren’t Cost-Effective Anymore

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Andrew Follett Energy and Science Reporter
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Solar panels became way less cost-effective after Louisiana cut back solar subsidies, according to industry insiders Wednesday.

Louisiana cut back solar subsidies late last year and began taxing rooftop solar panels, apparently costing a solar lobbyist a fair amount of money.

“Back in 2012, my family installed a new solar power system on our home,” Simon Mahan, a renewable energy manager for the green energy lobbying group called the Southern Alliance for Clean Energy, wrote in The IND Monthly.

“The new rate structure for current net metered customers, including solar power families like mine, is also likely to almost double our monthly electric bills. And the new solar tax will likely double the payback time,” Mahan wrote.

Net metering forces utilities to buy the electricity produced by rooftop solar panels at up to six times the market price, effectively forcing people who don’t own rooftop solar panels to pay more to maintain the grid.

Mahan goes on to claim that the changes came as a “total shock to our family” even though they were announced months in advance. The lobbyist is also reportedly shocked that having solar panels on the family roof won’t be profitable due to the cuts. The panels are still amply subsidized by the federal government.

Most solar subsidies go to residential installations and include a 30 percent federal tax credit. Previously, solar subsidies were so lucrative that solar-leasing companies installed rooftop systems, which run at minimum $10,000, at no upfront cost to the consumer. Companies do this because state and federal subsidies are so massive that such behavior is actually profitable, as solar companies simply cannot compete without government support.

Solar and wind power get 326 and 69 times more in subsidies than coal, oil, and natural gas, according to 2013 Department of Energy data collected by Forbes. Green energy in the U.S. received $13 billion in subsidies during 2013, compared to $3.4 billion in subsidies for conventional sources of energy and $1.7 billion in subsidies for nuclear, according to data from the EIA.

Researchers found that expanding net metering or maintaining it for long periods of time will drive up power prices. Without government support, solar energy is non-viable, according to a 2015 study by the Massachusetts Institute of Technology (MIT).

Despite huge subsides for green energy, wind and solar power only accounted for 4.7 and 0.6 percent respectively of all electricity generated last year in America , according to data from the Energy Information Administration.

Solar subsidies may hurt the poor and ethnic minorities disproportionately, according to data, because the economically disadvantaged tend to spend a higher proportion of income on basic needs like energy.

When public goods like electricity become more expensive, the cost of producing other goods and services which require electricity increases, effectively raising the price of almost everything. Policies like net metering hurt the poor 1.4 to four times more than they hurt the rich, according to a study by the National Bureau of Economic Research.

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