Sunny California has been aggressive and ambitious in harnessing the sun through solar energy systems. Like the name implies, the Million Solar Roofs vision introduced in 2007 sought to install solar photovoltaic cell panels on an additional million rooftops of home or businesses in the state by 2018.
Those rooftop solar panels, with an estimated 3,000 megawatts of solar capacity, would prevent the need to build the equivalent capacity in generating plants and transmission and distribution infrastructure for which ratepayers would be forced to fund construction. The 3,000 megawatts in solar energy translates to three nuclear power plants that could generate additional power on hot afternoons.
The Million Solar Roofs legislation, also known as the California Solar Initiative (CSI) or colloquially as Go Solar California, is well on the way to the goal. As evidenced driving around many neighborhoods, Californians installed nearly 2,000 megawatts of solar, equal to two nuclear power plants, from 2007 to early 2015, according to CNBC. This turned out to be prescient when leaks in the San Onofre nuclear power plant near San Diego forced it to shut down in 2011. The state suffered no shortage of energy as a result.
Cash incentives to achieve goal
When it launched in January 2007, the CSI program built upon the prior 10 years of support for the early adopters of solar, including the state’s initial incentive programs. The CSI legislation included provisions to:
- Establish incentives for solar energy, which required the California Public Utilities Commission (CPUC) to implement programs to invest in solar energy systems with the goal of installing those 1 million solar systems by late 2018.
- Move toward a self-sufficient solar industry with declining solar rebates as the solar industry matures and costs drop, making solar competitive with electricity generated using nonrenewable fossil fuels.
- Make solar energy a standard option offered in any new housing development of 50 homes or more by 2010, with the goal that 50 percent of all new homes would be built with solar energy systems installed within 13 years.
- Raise the net metering cap to accommodate the 3,000 MW of solar generation the million roof systems will generate. Net metering is a key component of making solar power cost effective, serving as free energy storage and allowing homeowners to sell surplus electricity back to the electric grid.
- Provide incentives for affordable housing by requiring that 10 percent of the funds be targeted for low income and affordable housing solar installations.
- Focus on building energy efficient buildings in the future
The CSI originally offered cash incentives on solar PV panel systems based on AC wattage. As of July 2012, they ranged from 20 cents to 35 cents per AC watt for residential and commercial entities. The publicly owned utilities in the state established rebates under CSI to encourage their customers to adopt solar. All of these incentives, when combined with the 30 percent federal tax credit incentive, could potentially cover up to 50 percent of the total cost of a installing a new solar system in California.
However, the CSI program was designed so that incentives drop or stop based on the amount of solar capacity installed. Separate levels were set for residential and nonresidential customers in the territories of each of the three investor-owned utilities. The program was so successful that the rebate funds for customers in the Pacific Gas and Electric (PG&E) and Southern California Edison (SCE) areas of the state have been exhausted. In the San Diego Gas and Electric area, the residential rebates were exhausted over the past summer.
While these rebates are exhausted, there are still many incentives in place.
The CSI required that the installation work be done by a qualified solar contractor to ensure that the residence or business was getting the most productive solar energy system available for its roof design, sun exposure, etc. A qualified solar company that has installed countless systems will know what rebates and credits still exist in a given area. Many counties in California and municipal power companies have also established credits and rebates.
RGS Energy, which has nearly 40 years of experience with solar installations, is one highly qualified option. They have helped homeowners garner their credits and rebates.
Future with or without rebates or credits
The federal tax credit is set to expire at the end of 2016, although many elected officials are pushing for an extension. While many are rushing to install solar before then, there are great options to enable California to reach that one million roofs goal. First, remember that the initial incentives were set up because the cost of installation for early adopters of solar energy was high. That is no longer the case.
The cost of solar panels has dropped from approximately $150/watt in 1970 to 60 cents/watt today. The cost for installation in 2007, when CSI began, was about $10/watt of generating capability. It is now just over $5/watt for residential projects. In fact, many estimates show the cost of generating energy from the sun has dropped below the cost for coal-fired generation and is now close to the cost for natural gas generation. Through in the fact that distribution costs are minimal since it does not have to travel miles over transmission lines, and the picture is even more favorable.
Additionally, rates for electricity keep rising, but, the cost of energy for those who installed solar panels does not.
RGS Energy sold some of the very first solar panels to the public out of a small general store in Northern California. Since then, it has installed over more than 22,500 solar energy systems for homes, businesses, schools, government facilities, and utilities across the country, totaling more than 235 megawatts of clean energy. Visit RGSEnergy.com to learn more about how solar energy can work for you.