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September 1 , 2006

TODAY'S LOCAL NEWS - Solar Savings
Governor’s plan gives homeowners another reason to use solar power, just in case lowered energy bills, tax credits, and environmental friendliness weren’t enough
by Christine Davis

With the Aug. 21 signing of SB 1, Gov. Arnold Schwarzenegger’s landmark legislation known as the Million Solar Roofs plan, California is leading the charge toward using clean, renewable power.

Along with the California Public Utilities Commission’s California Solar Initiative, the state has created the largest solar power program in the country, offering financial incentives for residential and commercial installations, including federal tax credits.

But how does it break down into dollars and cents for North County home and business owners? According to Kurt Mulligan, chief executive officer of Clean Power Systems in Poway, a leading solar electricity system provider in Southern California, a house or business must first have its current and future power needs analyzed through an energy audit.

“Having the proper sized system is critical,” Mulligan said. “For a homeowner paying $200 per month for their energy bill, they would be looking at a system in the neighborhood of $50,000. The customer would receive a $15,000 rebate (a 30 percent discount) paid directly to the customer by the state about 60 days after installation, and an additional $2,000 federal income tax credit.”

Escondido resident Jim Green retrofitted his 20-year-old home last summer. He bought his solar system for $34,845 and received an $11,000 state rebate as well as a $2,000 federal tax credit.

“My energy bill for the entire year was $46,” Green said. In addition to providing electricity to heat his pool, the system powers the entire house.

“I installed solar as a combination of trying to do the right thing with the goal of saving money in the long run,” he said.

Green explains that because the system feeds power into the main grid, which powers everything with regular electricity, there is no difference in the quality of power he receives.

“The power we are talking about today is not the hot water systems of the ’70s,” Mulligan said. “There are no moving parts so nothing breaks down over time. It is a chemical process that turns sunlight into energy.”

Public education will be key to explaining the benefits of new technology including new construction, improved appearance and 25-year warranties, he said.

The California Energy Commission surveyed homeowners and found that half would be willing to pay more for a home equipped with renewable technologies and 60 percent would be more interested in a home that has renewable technology installed compared with a home that does not.

In a 2003 study funded by the Department of Housing and Urban Development and the Environmental Protection Agency, energy-saving measures raised the value of a home by $20 for every $1 of yearly energy cost savings.

“With two homes being otherwise equal, the solar-powered home should be a better seller,” said Mark Wilke, a real estate agent with Re/Max By the Sea in Carlsbad.

Wilke, who started using solar energy in his five-year-old Carlsbad home a year and a half ago, said it was the best financial move he could have made at the time.

“With a child hitting her teen years, we wanted to make our home a destination home where she could bring her friends,” Wilke said.

“We decided to add a pool and air conditioning and knew from others we talked to that our monthly energy bills would skyrocket. With the addition of solar electricity we knew we could either entirely eliminate or at least substantially reduce our costs.”

Wilke said his monthly bill amounted to $20 even during the hottest summer months when he ran his air conditioner, two refrigerators and a pool. Prior to the installation of his solar energy system, Wilke said his monthly bill cost as much as $700.

Southern California home builders such as McMillin Homes, Shea Homes, Pardee Homes and Standard Pacific Homes are joining the solar movement and incorporating more aesthetically pleasing solar roof tiles into new home construction.

A requirement of SB 1 is that builders give home buyers the option of using solar power in their new homes, if applicable. Some builders, such as McMillin and Shea, are incorporating solar roof tiles into homes ideally suited for solar power and making it a standard feature.

“The real fact of the matter is that the signing of SB 1 could not have happened at a better time,” Mulligan said. “With energy price hikes once again being proposed, what solar does is fix your electric bill to a certain amount.”

Mulligan said that while solar electricity is here to stay, one technology is not going to solve the energy problem on its own. He said Californians will need to continue working on a diversified energy portfolio.