Solar Bill Enters Cloudy Summer

By Sarah Jane Tribble

Just months after lawmakers passed the nation’s largest-ever solar power rebate program, encouraging California residents to harness the sun and ease the summer energy crunch, the program enters summer facing an uncertain future.

The $3.2 billion program, pushed by Gov. Arnold Schwarzenegger and supported by business and consumer advocates, calls for solar panels to be installed on about 1 million homes — enough to handle as much as 6 percent of the state’s electricity needs on the hot summer days when demand is highest. To reach that goal, state energy leaders say subsidies for homeowners and rules for home builders are paramount.

But the pivotal bill that would provide those incentives has stalled repeatedly in the Legislature — the victim of political sparring, particularly over labor issues. Those issues have since been negotiated out of the bill altogether and its author, Sen. Kevin Murray, D-Culver City, predicts the bill will end up on the governor’s desk by the end of the summer.

Murray predicts the amended bill will pass the Assembly by the end of the month. Then it goes back to the Senate, where it originated, for final approval.

"We’re holding our breath," said Bernadette Del Chiaro, clean energy advocate for Environment California.

The proposed incentives law, SB 1, reads like a laundry list of consumer concerns: It ensures that Pacific Gas & Electric continues buying energy from solar customers, requires large home builders to offer solar power and guarantees the creation of standards and warranties for solar equipment.

A typical solar installation costs $20,000 to $25,000, with state rebates and federal tax incentives covering about a third of the cost. Consumers who have installed solar panels also get a break on their monthly energy bills — sometimes reducing their payments to less than $10 — because PG&E buys the solar energy each home puts into the system.

Solar advocates fear that if the package of solar energy incentives doesn’t pass soon, the growth in solar panel installations will grind to a halt. PG&E said it will not buy solar power above the amount the law requires — it’s up to legislators to raise the cap.

Los Altos homeowners Julia Fuerst and Mike Balma said they probably would have skipped solar energy if PG&E were not buying the power back. Balma said he saves at least $600 annually because of the solar benefits.

The buyback system allows solar customers to bank energy credits earned during the summer and use them during winter months. With programs like this, PG&E has signed up more solar users than any other utility in the nation.

Energy experts and solar customers say that without the solar energy credits the average amount of time it takes a homeowner to pay off a solar system could double to at least 14 years.

"The public is just now looking at other alternatives" for energy, Fuerst said. "So, any little stumbling block is going to make people hesitate."

By 2017, the state hopes to bring solar production up to 3,000 megawatts, the equivalent of power produced by five or six natural gas plants. But many experts say that isn’t possible without solar credits to boost the program’s start.

Earlier this year, PG&E proposed to continue buying power from new solar customers until the end of December or when a cap on the amount of solar energy it must accept is reached. That cap could be reached by December, said Bruce Bowen, director of regulatory policy for the company.

The utility is waiting to see whether lawmakers decide to increase the amount of solar it must accept, thus making the solar energy credits available to new customers.

Though the bill stalled last year, its author, Murray, expects it has the momentum to carry it through the summer session.

"If there is a place in the world where solar should work," he said, "it should be California."

Contact Sarah Jane Tribble at stribble@mercurynews.com or (408) 278-3499.

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Copyright (c) 2006, San Jose Mercury News, Calif.

Distributed by Knight Ridder/Tribune Business News.

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