Here Comes the Sun: More SLO County Wineries Are Taking Advantage of Recent Tax Incentives and More Than 300 Days of Sunshine a Year to Slash Their Electricity Bills By Installing Solar Power Systems
By Ermina Karim, The Tribune, San Luis Obispo, Calif.
Jul. 16–A number of local wineries are turning to the sun for more than just ripening their grapes.
After years of increasing energy costs, wineries, including Tablas Creek Vineyards, L’Aventure, Alban Vineyards and Castoro Cellars, are installing solar power generating systems to take advantage of the average 300-plus days of sunshine on the Central Coast. Winery owners plan to power everything from production equipment and water pumps to air conditioning and computers.
While winery professionals stress that the environmentally friendly power is in line with their commitment to sustainable practices, the costly conversion is more palatable as a result of recent federal and state rebate and tax incentives for the technology.
“We’ve been talking about solar power for the last 15 years but weren’t ready to do it,” said John Alban, owner of Alban Vineyards in Arroyo Grande, which switched to solar power in March. “The efficiency of the technology is much better now, and with cost of electricity moving higher, the value of the system versus its installation cost is there.”
No longer a luxury
Photovoltaic systems are the most widely used means for generating electricity from solar power. Arrays of semiconductor material absorb sunlight and convert it to electricity. Systems can be connected to the electric grid or can be used as off-grid systems.
These photovoltaic systems typically are backed by a 25-year warranty and, with no moving parts, are touted as being virtually maintenance-free.
While the environmental benefits of solar power are well-documented, the systems have been long viewed as prohibitively expensive to install and have remained a niche product. However, recent federal and state financial incentives are popularizing the alternative energy. Advocates point out that solar power systems are a smart investment at a time of rising energy costs.
The average solar power generating system costs from $8 to $10 a watt, including installation, before any incentives are applied. Systems under 30 kilowatts can take advantage of a California solar rebate of $2.60 per watt of system costs. There is also a 30 percent federal investment tax credit available for businesses. Finally, users are able to depreciate the cost of the system on a five-year accelerated schedule.
“The government is essentially picking up two-thirds of the tab,” explained Rob Hichborn, director of sales at Premier Power Renewable Energy, a solar power installation firm near Sacramento.
In early June, Tablas Creek Vineyards in Paso Robles installed a 35-kilowatt solar system tied to the grid after REC Solar, a Los Osos-based solar installation company approached the winery. Jason Haas, general manager at Tablas Creek, anticipates that the system will cover about half the winery’s needs. It is financed over 10 years, but if electricity costs continue to go up, the system will pay for itself faster, Haas said.
“We used to think that going solar was a luxury,” Haas said. “But now it is not just earth-friendly — it makes financial sense.”
Right time to go solar
Niels Udsen, owner of Castoro Cellars, has just signed on with REC Solar to install a solar power system at its Templeton tasting room as well as a nearby vineyard. Both should be in place by October, and Udsen expects the system will supply 60 percent of the necessary power. He anticipates a five-year payback on the vineyard and an eight-year payback on the tasting room at current Pacific Gas and Electric Co. rates.
“We’ve wanted to do this for a long time,” said Udsen. “The incentives are certainly a motivating factor, but it also fits into our overall philosophy. We are always looking for ways to lessen our impact on the environment.”
L’Aventure in Paso Robles also recently installed a solar power generating system with Premier Power. The winery anticipates it will pay for itself in five years.
“It only took two weeks to install, and it was done with minimal interruption at the winery,” said Dave DeBusk, vineyard manager and associate winemaker for L’Aventure. “It’s a no-brainer.”
Solar power installation companies such as REC Solar and Premium Power say they are in talks with other area wineries considering going solar. Doug Beckett, owner of Peachy Canyon Winery, is in the process of building a solar powered home. He says that if things go well, he’ll convert the winery as well.
“Our phone is definitely ringing,” said John Ewan, owner of San Luis Obispo-based Pacific Energy Co., a distributor of energy products. “The awareness level is definitely up and businesses are less timid to go solar. They have long recognized the green advantage, but now there is a financial advantage as well.”
Rolling back the meter
One of the fundamental drivers of solar power generating systems has been the net metering law, which took effect in 1996. The program allows users connected to the grid to sell back excess power for credit to PG&E.
Solar power systems are outfitted with a meter that runs forward and backward based on energy use. During peak hours of sunshine, the solar panels may produce more energy than required by the user so the meter would turn back. When the user needs to draw power from the grid, at night for example, the meter runs forward.
To better exploit PG&E’s rate structure to make the solar system more economical, users optimize PG&E’s time-of-use rate. This billing cycle charges a premium rate between noon and 6 p.m. As those are also the ideal hours to run on solar, credits are sold back to the utility company at peak rates and stored until they are needed.
An annual PG&E bill tallies the net power used. If a user draws down more power than they put into the system, they pay the difference. If they banked more credits than they used, their bill is zero.
Alban says his electricity bill has been at or near zero since switching to solar. REC Solar installed three systems to run his winery, agricultural well and home on 55 kilowatts of photovoltaics after reviewing two years’ worth of his electricity usage.
“It’s a really smart system. You don’t experience any change, other than in the monthly bills,” said Alban. “We’re essentially using PG&E as a giant battery.”
Power blip
However, the net metering program faces an uncertain future. A provision of the law states that when enough photovoltaic systems have been installed that the total capacity reaches 0.5 percent of the utility’s peak demand, it no longer has to provide net metering to new installations. In PG&E’s case, 0.5 percent represents 95 megawatts of solar generated power, a threshold that company officials say it expects to reach before the year’s end.
A proposed law, Million Solar Roofs Bill (Senate Bill 1), recommends raising the net metering cap to 2.5 percent. The bill, which is endorsed by Gov. Arnold Schwarzenegger, was approved by the Assembly at the end of June and will return to the Senate when the Legislature returns from recess in August.
Sharon Gavin, a PG&E spokeswoman, said the utility supports passage of the bill.
“We would like to see the cap increased,” said Gavin, noting PG&E’s “commitment to renewable energy.
“However, if it isn’t extended, there will be no more net metering as it won’t be permitted by the state.”
New local solar power users echo that they are not worried about the impending cap.
“I don’t believe it will happen. Distributed energy sources help the grid,” said Tablas Creek’s Haas. “I don’t think that it will be allowed to lapse.”
Reach Ermina Karim at 781-7923.
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Copyright (c) 2006, The Tribune, San Luis Obispo, Calif.
Distributed by McClatchy-Tribune Business News.
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