Californians are cashing in on the Golden State's sunshine thanks to a new initiative that aims to stimulate the installation of 3,000 megawatts of solar electrical generating capacity in the state over the next decade. Developed in large part by State Sen. Kevin Murray and signed into law by Gov. Schwarzenegger in August 2006, Senate Bill 1 creates a $3.35 billion solar program to install 3,000 megawatts of solar photovoltaic (PV) systems by 2017 and bring solar energy into the mainstream.
The California Solar Initiative (CSI) is the biggest solar program in the United States and the second largest in the world, after Germany. If it works as planned, CSI will generate the same amount of power as 30 small natural-gas fired plants. In doing so, the CSI is expected to generate 40,000 new jobs in California. Not surprisingly, policymakers in other states are watching California's initiative closely. New York, New Jersey, and Connecticut are among the states that have solar programs with more modest targets in place.
The CSI offers customers a rebate on the installation of solar electricity systems on top of the federal tax credit of up to $2,000 that has been available nationwide since 2006.
The cost of PV systems vary, depending on their size and the type of components used. A 2-kilowatt system, which could offset about 60 percent of the average Californian's electricity demand, may cost $16,000 to $22,000, or $8 to $11 per watt, before any rebate or tax credit. When you factor in federal tax credits, the cost could be lowered by as much as $7,000. Depending on annual electricity bills, Californians can recover this investment over the course of several years.
That's because the state rebate and federal tax credit are bolstered by other policies, such as a law that requires power companies to credit their customers for the excess power the panels produce. At the end of the year, credits for solar power sold by home and business owners back to the grid are applied against charges for power taken from it -- a measure that helps solar producers "zero out" their electricity bills (except for the monthly customer charge).
By reducing the payback period of solar roofs, these policies encourage wider adoption of solar PV systems, cutting substantially the greenhouse gas emissions that are produced by conventional power sources like coal. A 2-kilowatt PV system can eliminate 3,699 pounds of carbon dioxide emissions in its first year of operation.
The CSI is designed to reduce the cost of harvesting solar power from rooftops and help grow the nascent industry to a point where it can be weaned off public subsidies. It does so in part by replacing year-to-year subsidies that have been in place since 1998 with a 10-year program of rebates aimed at providing producers and consumers with greater regulatory certainty.
By reducing the need to generate power from traditional sources as well as the need to build new plants, CSI is expected to save Californians as much as $18 billion dollars, according to an analysis by Vote Solar.
Already, the prospect of lowering monthly electricity bills appears to be sparking substantial new interest. More than 7,000 California homeowners filed plans with the state energy commission to install solar roofs in 2006, up from about 4,000 in each of the previous two years.
Such enthusiasm is also spurring growth in the state's solar installation industry. The California Energy Commission, which helps to administer CSI, has recently registered 434 companies to install solar systems. Such companies typically provide homeowners with one-stop shopping, including system design, permit applications, rebate processing, installation, maintenance, and warranty.
Presently, the $3-plus billion program has three key components:
1.) It provides $1.7 billion to spur solar installation on existing homes and on new and existing commercial, industrial, and agricultural properties. Funding for this program component comes from electric utility distribution rate revenues. Ten percent of program funds are allocated for solar installations in low-income and affordable housing.)
2.) It authorizes the California Energy Commission to spend up to $400 million to achieve 400 MW of solar capacityon new home construction.
3.) It requires all publicly-owned utilities in the state to provide up to $784 million in incentives for solar.
Presently, all electric customers of Pacific Gas and Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E) are eligible to apply for rebates. The program requires the state's major publicly-owned electric utilities to adopt, implement, and finance a solar initiative program by January 2008.
By opting to produce clean, green energy on their homes and businesses, thousands of Californians are helping to protect the climate, reduce electricity bills, and create jobs.
The California Solar Initiative
http://www.GoSolarCalifornia.ca.gov
The Vote Solar Initiative
http://www.votesolar.org/
The California Solar Initiative Handbook
http://www.gosolarcalifornia.ca.gov/documents/CSI_HANDBOOK.PDF
NSHP Guidebook
http://www.gosolarcalifornia.ca.gov/
documents/CEC-300-2007-008-CMF.PDF
Renewable Hotline
1-800-555-7794 (Renewable energy call center)
E-mail: renewable@energy.state.ca.us
Terrie Prosper
News and Public Information Office
California Public Utilities Commission
505 Van Ness Ave.
San Francisco, CA 94102-3298
(415) 703-2160
mailto:tdp@cpuc.ca.gov
Jan Mazurek
Director
Energy & Environment Project
Progressive Policy Institute
600 Pennsylvania Ave. SE Suite 400
Washington, D.C. 20003
(202) 547-0001
(202) 544-5014 (fax)
jmazurek@ppionline.org
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