Acadian_Consulting_GroupAcadian Consulting Group, run by David Dismukes, published a study for the Louisiana Public Service Commission (LPSC) on the subject of net metering earlier this year. Dismukes has criticized renewable energy subsidies, while supporting those for for fossil fuels. Critics of the consultant point to funding for the group. In fact, according to reporting from The Times-Picayune, Acadian has received direct funding from industry groups on several research projects, including $20,000 from the America’s Natural Gas Alliance for a report that was critical of federal wind energy subsidies. Acadian’s other clients in the utility and fossil fuel industry include:

• Cajun Electric Cooperative

• CLECO Corporation

• Consolidated Edison

• Duke Energy Gas Transmission

• Duquesne Light Company

• NRG Energy

• AGL Resources

• ANR Pipeline Company

• Colorado Interstate Gas Transmission

• Columbia Gas Transmission (NiSource)

• Columbia Gulf Transmission

• El Paso Corporation

• Evangeline Gas Company, Inc.

• Florida Gas Transmission Company

• Mississippi River Transmission (subsidiary of Centerpoint)

• Reliant Energy Gas Transmission

• Sempra Energy

• Texas Gas Transmission Corporation

• Transcontinental Gas Pipeline Corporation

• Trunkline Gas Company (Energy Transfer Partners)

• Lake Charles Cogeneration LLC.

• U.S. Oil and Gas Association (Alabama and Mississippi Chapter)

The 2015 study for the LPSC was meant to study the cost of net metering “imposed” to other ratepayers, but instead focused on the state’s 50 percent tax credit for installing new solar panels. The study claimed those credits cost the state at least $89 million.

Barry Goldwater Jr., a former congressman and co-chairman of the solar advocacy group Tell Utilities Solar Won’t Be Killed, said, “This study is a blatant attempt to undermine the rights of Louisiana residents and to prevent the growth of the solar industry.”

Politifact studied the claims made by Americans for Prosperity, which cited the Dismukes study, that electricity prices were skyrocketing because of solar subsidies and net metering. Politifact determined that increases in ratepayers bills did occur but not because of the solar policies:

Louisiana customers outside of New Orleans did see a base rate hike in 2014, which cost the average ratepayer about 47 cents per month. But that increase was approved by the PSC in 2013 and was over several issues, including the cost of maintaining an aging power grid. Electric utility company Entergy did not specifically mention solar as being an issue when announcing the base rate change… So while Louisiana did see a rate increase, we don’t see evidence that it was specifically related to a solar initiative.”

Furthermore, Sierra Club exposed severe flaws in Dismukes’ report, stating that the LPSC study included legislative tax incentives as a cost of the LPSC net metering program. Sierra Club concluded:

No other net-metering cost-benefit analysis in the country has included state- authorized tax incentives as a cost. Public utility commissions have no authority over tax incentives and legislative policy choices, and such incentives are a cost to the state treasury not utilities or ratepayers. When these tax incentives are excluded from the utility’s cost calculation, as they should be, the study demonstrates actually that net metering provides a clear economic benefit to utilities and ratepayers.”

Acadian was also criticized for ignoring the costs of oil and gas subsidies since they analyzed solar subsides. In Louisiana, the tax credits for solar are dwarfed by taxpayer giveaways to the oil & gas industry. Louisiana taxpayers have provided over $1.2 billion to the oil and gas industry to subsidize fracking operations since 2010. This is a cost of nearly $250 million per year that is going to established, fossil fuel companies such as XTO Energy, owned by ExxonMobil, Halliburton, and Schlumberge.

In addition, a calculation of total oil and gas subsidies in Louisiana by Earth Track details that oil and gas subsidies in 2012 were at a minimum over $500 million. Severance tax losses, almost exclusively from oil and gas, cost the state $354 million in 2010. Finally, the utility, oil, and gas industry received an additional $964 million from 2008-2010 as part of the state’s Industrial Tax Exemption. For the electricity generation and utility sector alone, the state of Louisiana subsidized major utility companies by $276 million over that three year time period. These ratepayer subsidies for utility interests are generally not factored into the price of electricity from natural gas.

Another issue with the Acadian report was the timing of its release. A draft of the report was sent out in an email to state legislators by Commissioner Eric Skrmetta, who was narrowly reelected last fall against solar advocate, Forest Bradley-Wright. Skrmetta’s email came weeks before the report was supposed to be completed for the LPSC.

Posted by Energy and Policy Institute