Solar Energy Rebates in Jeopardy

Solar energy has been billed as the future for Arizona, but ask anyone in the solar industry and they'll tell you times are tough.

With so much sunshine in Arizona, you'd never guess the solar industry may be experiencing its roughest time in its short history.

Now, some fear the big utility companies and the Arizona Corporation Commission could make things worse.

Thousands of dollars worth of rebates from big utility companies helped jump-start the solar industry – but those rebates could soon be cut or eliminated altogether.

“I am doing far more business out of the state of Arizona than I am doing in Arizona right now,” says Robby Richards, who runs Copernicus Energy, a solar installation company based in Tempe.

He's one of dozens of solar installers, major home builders and huge corporations that don't like what the big utility companies are trying to do – so he wrote the Corporation Commission.

“The fact of the matter is the number of solar installations in Arizona that has exploded in recent years. It is really eating in the revenue of the incumbent utility players,” says Richards.

When the solar industry was just getting started, the state and big utility companies like APS started incentive programs that helped homeowners and businesses foot the bill for expensive solar panels.

Now, the Corporation Commission is considering proposals from APS that will drastically reduce the amount of money the company gives solar customers.

“These incentives not only help a homeowner put a 2000 watt solar system on their house. It is creating and industry that is supporting ten of thousands of employees across the United States and thousand here in Arizona,” he says.

Richards fears if the incentives decrease, so will jobs. But APS doesn't see it that way.

“The lowering of incentives is good for our customers and it is good for solar in the state,” says Steven Gotfriend from Arizona Public Service.

APS says demand for solar has skyrocketed so much that the pool of money available for rebates is disappearing too quickly.

“What we are seeing is an industry that is thriving and is not relying on artificial stimulus to keep it going,” he says. “Incentives were not designed to last forever. They were designed to stimulate the industry which it has.”

Not long ago, APS was paying around $3 a watt to a homeowner. With a 3000 watt system you’re talking a rebate of $9,000. Now APS is looking at an average of 85 cents a watt, which means a substantially smaller rebate.

With a limited pool of money and more demand, APS says the incentive will likely decrease even more.

“There are so many customers that want the incentive, by lowering the incentive we are able to give customers more solar for more affordable prices,” says Gotfried.

Critics say the big utility companies would rather invest in huge solar farms than rooftop systems that help customers decrease their power bills.

But not all solar companies are on the same page.

“If you are not going to support it 100 percent get out of it,” says Mike Fricker, who owns Salt River Solar and Wind, based in Surprise.

He’s got a full time staff of 14, whose primary responsibility is to hound the utility companies for unpaid rebates. Getting reimbursed, he says, can take months and the added cost often gets passed onto the consumer.

With the price of solar panels dropping, he questions whether the rebate programs are worth it.

“Do you think they really want me out there putting $50 million worth of solar on the roof? Is that good for their business? They are the competition. You have McDonalds managing Weight Watchers here. That’s what you've got,” says Fricker.

How the Corporation Commission will vote is not clear. But APS’ intentions sure are.

“The hope is that at some point we will not have to provide incentives to make solar an option for customers and we are getting very close to that as it is,” says Gotfried.

The Corporation Commission should make a decision by mid December. A little known fact -- Arizona ranks third among states when it comes to the number of solar installations.

California is first, and New Jersey, a state not known for its sunshine, ranks second.

SOURCE: http://www.myfoxphoenix.com/dpp/news/only_on_fox/solar-energy-rebates-in-jeopardy-12-5-2011