The Louisiana Public Service Commission (PSC) adopted rules for net metering and interconnection in November 2005. Louisiana's rules, based on those in place in Arkansas, require publicly-owned utilities and rural electric cooperatives to offer net metering to customers with systems that generate electricity using solar, wind, hydropower, geothermal or biomass resources.* Fuel cells and microturbines that generate electricity entirely derived from renewable resources are also eligible. The rules apply to residential facilities with a maximum capacity of 25 kilowatts (kW) and commercial systems with a maximum capacity of 300 kW. In 2008 (Act 543), the state legislature increased the net metering and interconnection limit from 100 kW to 300 kW for commercial and agricultural use. The PSC opened Docket R-31417 in July 2010 in order to review its rules to increase to the state-mandated 300 kW limit. The PSC approved the increase in May 2011.
Utilities must provide customers with a meter capable of measuring the flow of electricity in both directions. Although utilities must pay for the cost of the meter itself, customer-generators must pay a one-time charge to cover the installation cost of the meter. Interconnected systems must meet all safety and performance standards established by local and national electric codes, including the National Electric Code (NEC), the Institute of Electrical and Electronics Engineers (IEEE), the National Electrical Safety Code (NESC), and Underwriters Laboratories (UL). A manual external disconnect switch is required for all interconnected systems. The manual external disconnect switch requirement is waived if the inverter is designed to shut down in the event that utility service is lost, the inverter is warranted by the manufacturer to shut down in this situation, and the inverter has been inspected and tested by utility personnel.
Customers seeking to interconnect and net meter must submit an interconnection agreement to a utility 45 days prior to interconnection. Utilities must use a PSC-approved standard interconnection agreement for interconnected facilities.
Customers must pay for "interconnection costs," defined as "the reasonable costs of connection, switching, metering, transmission, distribution, safety provisions and administrative costs incurred by the electric utility directly related to the installation and maintenance of the physical facilities necessary to permit interconnected operations with a net-metering facility, to the extent the costs are in excess of the corresponding costs which the electric utility would have incurred if it had not engaged in interconnected operations, but instead generated an equivalent amount of electric energy itself or purchased an equivalent amount of electric energy or capacity from other sources." Furthermore, following notice and opportunity for public comment, the PSC may authorize a utility to assess customer-generators "a greater fee or customer charge, of any type, if the electric utility's direct costs of interconnection and administration of net metering outweigh the distribution system, environmental and public-policy benefits of allocating the costs among the electric utility's entire customer base."
* The PSC regulates investor-owned utilities and electric cooperatives in Louisiana; it does not regulate municipal-owned utilities, and its rules do not apply to municipal utilities. Municipal utilities must develop their own programs based on the statute.