Sunny Outlook. Law boosts developing industry.

Boosters of solar-energy generation are anticipating boom times following enactment of a California bill that expands the 10-year, $2.9-billion California Solar Initiative created in January. The law, known as SB 1, caps a two-year effort to make the state the national leader in solar energy. SB 1 extends the coverage of the initiative, also known as the Million Solar Roofs program, and creates $100.8 million in incentives for residential and commercial establishments to install solar power systems by 2018.

The California Public Utilities Commission created the earlier program, but CPUC’s authority extends only to investor-owned utilities. Under SB 1 the program now covers municipal utilities such as Sacramento Municipal Utilities District and Los Angeles Dept. of Water and Power. The program aims to generate 3,000 MW using solar energy.

The bill creates certainty for the future by offering incentives and making solar energy attractive, says Les Nelson, executive director of the Rio Vista-based California Solar Energy Industry Association. The new rules increase the net-metering cap for solar photovoltaic (PV) systems, allowing energy consumers whose systems generate excess power to sell it into the electrical grid. “This provision allows customers to capture the full value of their solar PV system’s electrical generation,” Nelson says.

Industry officials expect California’s solar program to influence the PV market elsewhere. “I believe California will become an aggressive solar market much like Germany and Japan, two countries widely known as solar energy users,”says George Douglas, spokesman for the National Renewable Energy Laboratory, Golden, Colo. He also notes that emerging solar technology such as thin-film technology will help drive down prices, creating more market demand.

Material and installation can cost $9 to $10 per kilowatt, estimates Douglas. PowerLight Corp., Berkeley, Calif., reports that the payback period for a 140-kW system it installed for a Napa, Calif., vineyard was four years.

“The return on investment helps the system eventually pay for itself,” says Kari Smith, PowerLight’s director of regulatory affairs. “We’re already working with major home builders such as Sentix and Lennar, and commercial customers such as Lowe’s, Target, FedEx, Microsoft and others.”