Sun Put to Work By Many

By Doug Rutsch, The Sacramento Bee, Calif.

Sep. 30–Karan Khoshcar is taking the sunny approach to running his business, University Imports Automotive in Davis.

Since installing 76 solar panels on his rooftop two years ago, Khoshcar can generate up to 10 kilowatts of natural solar power — the equivalent of taking 20 cars off the road, according to the California Energy Commission.

“I recycle and … I don’t like to waste,” said the 22-year Davis resident. “And the system will pay itself off in under 10 years.”

From Khoshcar’s small auto repair shop in Davis to Emigh Hardware’s expansive store in Sacramento — which unveiled its new 200-kilowatt rooftop solar panel system earlier this week — companies of all sizes are taking a renewed look at the benefits of solar power.

Motivated by tax incentives and prodded by rising energy prices, solar power has undergone something of a revival in California recently.

“Over the last three or four years, since the incentive programs started, the interest in larger business installations has been rising exponentially,” said Sara Birmingham, manager of self-generation incentive programs at Pacific Gas and Electric Co. in San Francisco. “The trend is upward across the state, with a phenomenal amount of activity in Northern California.”

More than 11,000 residential and commercial solar projects were completed between 2001 and 2004. Already in 2005, more than 7,000 solar systems have been installed, according to the Energy Commission.

Despite the recent flurry, the future of California’s solar industry is somewhat uncertain, given that the state’s solar tax rebates are due to expire Dec. 31, and the governor’s highly touted $2.5 billion “Million Solar Homes” initiative, SB 1, died in the last days of the legislative session amid wrangling over use of union labor.

Mike Daly, owner of Sierra Pacific Solar in Rancho Cordova, said the failure of SB 1 could signal a precipitous fall for the solar installation business.

“There’s a lot of uncertainty,” he said. “We lost a very important bill.”

Despite the failure of SB 1, which would have extended the state’s solar tax credits, Gov. Arnold Schwarzenegger is going to continue pushing solar power, said his spokesman Bill Maile.

“The governor is committed to the million-solar-roofs initiative,” Maile said.

The bill’s primary author, state Sen. Kevin Murray, D-Culver City, said he plans to re-introduce the bill in the next legislative session.

“I believe in the bill and will continue to look for a way to work things forward,” Murray said this week.

Energy Commission spokesman Bob Aldrich said the failure of SB 1 is a temporary setback in what he calls a promising future for California’s solar industry.

“Even if the bill didn’t go through, there’s still time for additional incentives,” he said.

Under the state’s current solar tax credit program, residential and commercial solar installations can receive income tax credits of 7.5 percent on certified photovoltaic systems of up to 200 kilowatts that are installed by Dec. 31.

According to PG&E, 19 Yolo County businesses have received solar power tax credits to date. In Sacramento County, 87 businesses have taken advantage of the solar credits, according to a Sacramento Municipal Utility District spokeswoman.

Despite the setback, no one’s turning out the lights on solar installations, according to Rick Lavezzo, president of Team Solar Inc., who said his McClellan Park company had $5 million in revenues last year.

Though many of the company’s solar installations are in residences, it also works on larger jobs with businesses.

One of those is the Emigh Hardware flagship store on El Camino Avenue, which recently flipped the solar switch on its 21,600-square-foot installation, capable of generating 200 kilowatts of solar energy.

The original price of the installation was $1.5 million, according to owner Rich Lawrence. After all the tax credits and rebates, the final price will be a mere $342,000,he said.

“It does a lot of good to generate your own energy,” said Lawrence, who expects the store’s annual electricity bills to drop about $35,000. “And it puts a $1.5 million asset on the roof.”

Solar energy also has become a marketing tool for some companies. FedEx, which installed a 904-kilowatt solar system at its massive distribution center in Oakland, claims it’s the largest corporate solar installation in California, while Woodlands Market in Kentfield, Marin County, which has a 100-kilowatt system on its roof, bills itself as California’s largest solar-powered grocery store.

For business owners such as Khoshcar, it’s less about bragging rights and more about energy savings. Khoshcar’s solar system came with a price tag of $83,000. Tax breaks whittled the total cost down to about $40,000, he said. Without the incentives, the price of the switch to solar would have been too great for his small business.

By generating its own solar power, Khoshcar said his auto shop’s electricity payments have dropped from $600 a month to less than $200.

Solar installer Daly said the still-burgeoning solar industry needs about 10 years before it becomes stable enough to exist without favorable tax breaks.

“When the volume gets generated, the cost of the panels will come down and the subsidies can do down with it,” he said. “But that’s not there yet.”

Still, all sides agree that solar is one of the best ways for California to reduce its reliance on fossil fuels.

“Solar is here to stay, and it’s becoming more affordable for the average person,” Aldrich said. “Why not take advantage of the free resource that’s falling on all of our rooftops?”

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Copyright (c) 2005, The Sacramento Bee, Calif.

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