SACRAMENTO — California homeowners are rejecting new rebates for solar power equipment, saying the state has made installing the rooftop panels far more costly than expected.
As a result, Public Utilities Commission reports show a decline of 78% in rebate requests in the first three months of this year, compared with last year, and the solar installation industry says it is threatened with collapse across much of California.
At issue is a requirement the state added Jan. 1 for getting a rebate under Gov. Arnold Schwarzenegger's Million Solar Roofs program. Applicants must first sign up for costly pricing plans offered by utilities that charge more for their electricity during hours of peak demand.
Alfred Cellier had plans to install a $17,000 solar system at his Rancho Palos Verdes home until he penciled out the cost of the new state requirements and decided against it.
The retired electronics engineer said he was all for solar power "because it's green and the right thing to do, but I don't want to be treated unfairly."
Sue Kateley, executive director of the California Solar Energy Industries Assn., said the rebate changes backfired. "It's a mess," she said. "It was everyone's intent to expand the use of solar in California, not throw it into the ditch."
Many homeowners quickly decided that it might not be worth going solar under the new requirements. The costs would be burdensome for those who couldn't afford or lacked the roof space to buy systems that would supply all of their electricity needs.
The unintended glitch was created in December, when the PUC moved to implement the law by requiring that solar users switch to the higher "time of use" rates for their supplemental electricity.
Industry experts say that with the higher rates, solar power offers less savings on electricity bills and may not justify the investment of more than $10,000 in solar panels -- even with a rebate of as much as 50% of the cost and a federal tax credit.
What's worse, some people in the Inland Empire and the desert might see their bills rise after putting solar panels on their roofs, the experts add.
"The solar industry in the desert in the Southern California Edison territory is dead until this thing is fixed," said Pat Conlon, an energy-efficiency expert with the city of Palm Desert. "As of Jan. 1, there have been no new installs."
