Solar hot water incentives approved

Redwood Times
Posted: 01/27/2010 10:24:01 AM PST

The California Public Utilities Commission (CPUC) announced last week that it has established a California Solar Initiative (CSI) that will provide rebate incentives to promote the installation of solar water heating systems in new and existing homes and businesses. The rebates will be paid up front and the incentive program will be retroactive to August 2009, and will continue through 2017, or until all the funds are exhausted. The program begins with $250 million, collected through a surcharge on natural gas ratepayers, and up to $100.8 million already authorized and currently being collected through the general market CSI photovoltaic program.

This step is the culmination of Assembly Bill 1470, passed in 2007 by the California Assembly, to mandate that the state’s natural gas utilities provide cash incentives for solar water heaters. The goal of the CSI is to significantly increase the size of the solar water heating market in the state by displacing current gas and electric systems. The CPUC will facilitate marketing of the solar systems by programs to reduce market barriers such as high permitting costs, lack of access to information and lack of trained installers.

The amount of rebates paid will be based on estimated first-year kWh displacement. Incentives for systems displacing natural gas range from $1,500 to $550. Incentives for electricity displacing systems range from $1,010 to $380. The difference between natural gas and electrical replacing systems is due to the differing economics of the two systems.

The incentives will be dispersed by the state’s utility corporations. In this area, PG&E will be administering the program.

California imports 85% of its natural gas, two thirds of which is used by homes and business for water and space heating. A robust solar water heating market could save 1.2 billion therms of natural gas each year, or 5% of the state’s demand. This could, in turn, lead to lower prices for natural gas.

California is already home to several of the nation’s largest manufacturers of solar water heaters and dozens of local installation companies which all expect increased business due to the rebate program. Some estimates expect that the program will create 3,000 new jobs in the state.

Solar collectors, usually placed on the roof, absorb the sun’s energy to heat water that is then stored in a water tank. The efficiency of the collectors can be as high as 87%, meaning very little solar energy is lost in the process.

http://www.redwoodtimes.com/garbervillenews/ci_14278670