Solar program shows clunkers aren't the only popular incentive

The Florida solar rebate program is so successful that it keeps running out of money, forcing Florida residents and businesses that install solar energy systems to gamble on the possibility that they’ll never see the state’s promised payback.

With a $4 rebate for every watt of photovoltaic power installed and significant rebates for homes or businesses installing solar hot water heaters, the stakes can total tens of thousands of dollars.

“We’ve been victims of our own success,” said Florida House Majority Leader Adam Hasner, R-Delray Beach, a solar energy supporter. “There hasn’t been enough money to sustain the amount of people who want to apply.”

The program, begun in 2006, currently owes $7 million for approved rebates, according to Gov. Charlie Crist’s energy office, which administers the program. With $5 million in federal stimulus funds feeding the program this year and $9.4 million more expected, the program is playing catch-up as demand rises.

Florida’s record $6 billion budget shortfall kept the state from investing any of its own money in the program this year, Hasner said. Still, the solar rebate program will be better funded this year than ever before – assuming the additional stimulus funds materialize.

For those willing to purchase solar photovoltaic panels, the state promises a cash rebate that can comprise 40 percent to 50 percent of a system’s total cost. Add that to a 30 percent federal tax break and the incentive to go solar is stronger than ever, South Florida solar business owners say.

But, with $1.5 million in rebates approved for South Florida in fiscal year 2009, vendors are concerned about what could happen if the Legislature fails to fund the program again next year.

“Until the funding gets cleared up, it’s only the very wealthy and committed green advocates who will [invest in costly solar projects],” said Paul Farren, owner of the Energy Store in Hollywood.

Vendors typically sell solar thermal systems that heat water for homes and businesses, but Farren said he won’t succeed without the pricier photovoltaic systems. His business typically sells one photovoltaic system a month, but he needs to average two or three a month to survive.

Need a guarantee

Business would boom if Florida’s rebate program was guaranteed, said Alan Towsley, owner of Sunworks in Miami. Towsley, who installs solar technology across Broward, Miami-Dade and Monroe counties, said he would probably double his staff of six. But, ending the state rebate would significantly harm his photovoltaic and solar thermal business – a combined 65 percent of Sunworks’ revenue, Towsley said.

Dan Goldberg, co-owner of Advance Solar & Spa, said his company started concentrating more heavily on photovoltaic systems a few years ago when the rebate program began.

Goldberg said he’s watched the number of solar companies in the tri-county area grow rapidly since the program began.

“I get a call at least once a week from a new solar contractor getting into business,” he said.

With offices in Fort Lauderdale and Fort Myers, Goldberg said Advance Solar did hundreds of solar jobs in the last year. If the solar rebate program ended, though, he estimated business would decline 10 percent to 20 percent.

Goldberg said the program could be fixed to promote better economic development if the emphasis was shifted from photovoltaics to systems that heat water inside homes and businesses.

Right now, homeowners can get up to $20,000 back and businesses can get up to $100,000 back on photovoltaic systems. On the other hand, solar thermal units for the home only get a $500 rebate.

Solar thermal systems are typically cheaper than photovoltaics and they generate more in energy savings for the money spent, Goldberg said, noting that if bigger rebates went to solar thermal systems, more economic activity would result.

Jeremy Susac, executive director of the governor’s energy office, agreed that the rebate program could use some tweaking. More than three-fourths of the approved rebates are for solar thermal installations, but most of the money goes to photovoltaics, Susac noted.

“If you’re looking for the most bang for your buck, you’d want to fund the solar thermal side,” he said.

And, with market forces lowering the cost of photovoltaics and more generous federal tax credits recently enacted under the stimulus bill, it may be prudent to lower photovoltaic rebates in favor of thermal rebates.

Still, the program will likely remain an important piece of Crist’s alternative energy strategy next year, Hasner said.

“I would expect that there’s going to be a strong push to fund it at the highest level possible under the existing budget constraints,” he said.

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