Energy policy and Louisiana’s legislative outlook

With carbon capture, energy innovation and workforce development gaining momentum, Louisiana's chemical sector is closely watching the priorities emerging ahead of the 2026 legislative session.

The Louisiana Chemical Association (LCA), the statewide trade association representing the state's chemical manufacturing industry, enters the session following several years of unusually high activity at the Capitol. Between regular sessions and multiple special sessions over the past two years, lawmakers have addressed a wide range of issues affecting the state's economy, infrastructure, legal climate, energy framework and tax structure.

This year's regular session is a non-fiscal session, which removes restrictions on the number of bills lawmakers are allowed to file while limiting the Legislature's ability to consider certain topics, such as increasing existing taxes or creating new taxes. As a result, we expect to see a substantially greater number of bills filed this year than were filed in 2025. However, major tax issues that are important to manufacturers, including inventory tax and the tax on business utilities, cannot be meaningfully addressed this year.

On the other hand, carbon capture is once again expected to be among the most visible topics of the session. Louisiana has emerged as a national leader in carbon capture and utilization, supported by its existing O&G infrastructure, favorable geology, the EPA's grant of primacy and legislation that has created a comprehensive regulatory framework for project development. As projects continue to move forward, there is significant interest in maintaining a stable and predictable policy environment that supports continued investment and long-term business activity in the state.

Energy policy also remains an evolving area of interest. In addition to ongoing discussions related to grid reliability and industrial cogeneration, there is growing attention on alternative forms of energy generation such as solar, hydrogen and advanced nuclear. New developments in small modular nuclear reactor technology, along with continued advancements in blue and green hydrogen production, present opportunities for Louisiana to remain positioned as a leader in the global energy economy.

Legal reform continues to be part of the broader policy conversation in Louisiana. The state's litigious climate remains a concern for both individuals and businesses, and policymakers continue to explore ways to improve predictability and reduce the overall cost of doing business. While the scope and direction of potential proposals remain unclear at this early stage, developments in this area carry meaningful implications for Louisiana's economic competitiveness and investment climate. As a result, legal reform will remain an important issue to watch as the session unfolds.

There is also growing interest in legislation focused on skills-based education and workforce development. Louisiana's chemical industry depends on a highly trained workforce, and lawmakers have shown increased willingness to engage on policies that strengthen career pathways, technical education and workforce readiness. By collaborating with educators, community and technical colleges, workforce organizations and state leadership, the industry is working to retain talent in Louisiana by providing opportunities to gain valuable skills and earn competitive wages without a traditional fouryear degree.

As bills are filed and the session progresses, LCA will continue to monitor developments and engage constructively with policymakers. While this early outlook, drafted prior to the February 27 pre-file deadline, is necessarily general, it reflects the issues most likely to shape the legislative conversation affecting Louisiana's chemical manufacturing sector in the months ahead.

For more information, visit lca.org or email info@lca.org.