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Wednesday, Dec. 19, 2007 | Eleven solar panels went up on Robert Offord’s La Mesa roof Tuesday, adding him to the region’s slowly growing number of homeowners and businesses who rely on the sun for their electricity.
Across the region, Offord and others like him benefit from two subsidies that cut solar power’s cost. The retired teacher will get a tax break from the federal government and a rebate from the state. Together, the subsidies cut the cost of Offord’s $16,000 system by about $6,000.
“It’ll never pay for itself, but the sun is there, and it’s free,” Offord said. “I might as well use it.”
The state rebate comes courtesy of the California Solar Initiative, a $2.1 billion program launched a year ago and financed by state ratepayers. The 10-year program aims to install 3,000 megawatts of solar panels across the state — four times as much electricity as can be produced by the South Bay Power Plant in Chula Vista. San Diego is due to receive 10 percent of the solar panels.
When the initiative was launched, it was touted as a way to help the solar industry mature. By guaranteeing demand over a 10-year period, the state aimed to spark investment in the solar industry, hoping to drive down prices and make solar competitive with other power sources. Without subsidies, solar power is the most expensive way to generate electricity, according to the Department of Energy. It costs about four times more than energy from wind turbines, another renewable source.
At its first anniversary, though, the ambitious state initiative has not cut the price of solar panels. In fact, the price has been increasing — the result of global demand fueled by fledgling solar markets in Germany and Japan. For homeowners, the decision to install solar is still largely motivated by their environmental ethic, not their pocketbooks.
“Prices have not gone down. That’s the bottom line,” said Scott Anders, director of the Energy Policy Initiatives Center at University of San Diego. “I think it’s going to be harder to get to the goal than some people think. The real goal is getting solar power to grid parity — you’re indifferent from a cost perspective (buying) power from SDG&E or rooftop solar. But 2016? I don’t know.”
California has offered rebates for solar panels since 1999. But state officials approved those earlier rebates on a year-by-year basis. “Every year, the solar community said: ‘I wonder if we’ll be in business next year,’” said John Supp, program manager at the California Center for Sustainable Energy, a San Diego-based nonprofit that manages the solar rebate initiative’s local rollout.
The latest initiative was viewed as nothing short of revolutionary when it was approved in 2006. It carried a 10-year commitment — a signal to the solar industry that California was serious about the sun.
The initiative “was critical psychologically,” said Bill Powers, a local engineer who follows the solar industry. “It means in California there’s a lot of solar activity that wouldn’t have been there otherwise. But the worldwide push in Europe and Japan is much greater than what’s happening in California.”
Since the initiative was launched, the California Center for Sustainable Energy has exceeded its early benchmarks for solar installation in the region. Across San Diego County, homeowners and businesses have installed 27 megawatts of solar panels, enough electricity to power 17,500 homes. The majority have been on the roofs of businesses, which have higher utility bills and more rooftop space.
While solar prices are slowly increasing, systems continue to be deployed. Some solar users say they do it for the long-term savings. Many, like Offord, the retired teacher, say they just want to do the right thing for the environment.
Charles Roberts, an Ocean Beach architect who installed solar panels on his roof, previously paid $20 to $60 for his monthly electricity bills. Since the installation, he has expanded his home and added two residents. Despite the increased demand, he doesn’t pay any more than $5 a month. He expects the system to pay for itself within 15 years.
“Realistically, solar is still a costly thing,” Roberts said. “The payback on it at today’s energy prices is a long time. Most people who purely look at it from that point of view don’t install it.”
Supp, the sustainable energy program director, said he believes increasing electricity prices will continue to make solar look more appealing — even if its cost continues creeping higher.
“The value to the consumer is going up every year,” Supp said. “It may be the case in 10 years that we have a breakthrough in technology or manufacturing that maintains the cost or lowers it. But if utility rates increase, the equation for solar looks pretty promising still.”