Backed by Gov. Arnold Schwarzenegger, the bill will be taken up by the Assembly Appropriations Committee this month. It cleared the California Senate on a 30-to-5 vote June 1.
Under the bill, those who place solar photovoltaic systems on their homes or businesses — units that can start at $25,000 for a small residential project — would qualify for a rebate from a fund generated by surcharges on customers' utility bills. The rebates would decrease by 7 percent a year with the ultimate goal to secure a self-sufficient solar market by 2016.
The bill, co-authored by Sens. Kevin Murray, D-Los Angeles, and John Campbell, R-Costa Mesa, is the most comprehensive piece of solar legislation ever introduced in the United States.
Supporters, like clean energy advocate Bernadette Del Chairo of Environment California in Sacramento, calls it a "win-win" policy that will allow the solar industry and market the opportunity to grow in California.
Californians, frustrated by the state's energy crisis of 2001 and the seemingly never-ending rise in prices, are ready to welcome alternative energy, according to a poll conducted by the Field Research Institute for the San Francisco-based Vote Solar Initiative in June. Seventy-seven percent of respondents approved of increasing California's investment in the development of solar energy and 56 percent favor legislation providing incentives for installing 1 million rooftop solar energy systems in the state.
According to the California Energy Commission, since 2001 the demand for solar power has increased 10-fold.
Solar businesses view the bill as a way to shore up an industry that will thrive, they say, only with a guaranteed rebate program.
The rebate programs in place now, one for systems under 30 kilowatts administered by the California Energy Commission, and one for systems larger than 30 kilowatts, administered by the state's investor-owned utilities, are constantly "teetering on the edge" with no guaranteed funds, says Mike Hall, chief marketing officer in Borrego Solar Systems Inc.'s Berkeley office.
The rebates for those with smaller systems currently stands at $2.80 per watt while the rebate program for larger projects has been suspended due to an overwhelming demand and a lack of funds.
The certainty will allow manufacturers in the solar industry to ramp up production and drive down prices, adding jobs for manufacturers and those installing the equipment.
More customers means growth for companies such as 26-year-old Borrego Solar. The company, which counts 30 percent of its business from commercial projects, made a "big push" last year to secure more commercial projects. Those hopes were dashed when the rebate program for larger systems ran out of money.
Some opponents take issue with the costs of the rebate program. Utilities want a cap on the fees tacked on to ratepayers' electricity bills.
Paul Moreno, a spokesperson for Pacific Gas & Electric Co. in San Francisco, said that the utility is trying to protect its customers, who currently pay $70 million a year in solar power subsidies. PG&E wants to cap those charges at $100 million.
