San Francisco – California took another major step toward meeting its goal of building a million solar roofs and making solar power a mainstream energy technology today with the adoption of a new $350 million rebate program for solar water heaters. Consumers throughout the state can now take advantage of cash rebates for rooftop solar water heaters that promise to create green jobs, reduce air pollution and lower energy costs, according to Environment California a leading proponent of solar power.
“Harnessing the sun to meet our daily energy needs is a no-brainer, especially in California,” said Bernadette Del Chiaro, clean energy advocate for Environment California, sponsor of AB 1470 which created this rebate program. “Growing California’s solar water heating market will create green jobs, cut global warming pollution and save Californians money.”
The incentives for solar water heaters adopted today by the Public Utilities Commission will take the form of upfront cash incentives for residential systems estimated around $1,500 per home and up to $250,000 for large commercial and multi-family projects paid out over a few years according to performance. The rebates will be retroactive to August 2009 and will be available through 2017. The rebate program launched today was created as a result of AB 1470 (Huffman) passed in 2007 mandating the state’s natural gas utilities provide cash incentives for solar water heaters.
“Solar power represents a significant energy resource for California,” said Assembly member Jared Huffman (Marin), author of AB 1470. “California can achieve greater energy independence, fight global warming, and save homeowners and businesses money by encouraging a mainstream market for solar water heating.”
Solar water heaters will bring many benefits to the state:
- Solar water heating could reduce global warming pollution by 6.8 million tons of CO2 per year. This represents 5% of the total reductions needed to meet the state’s greenhouse gas emissions cap by 2020.
- California imports 85% of its natural gas, two thirds of which is used by homes and businesses for water and space heating. A robust solar water heating market could save 1.2 billion therms of natural gas each year, the equivalent of cutting 5% of statewide gas demand.
- Decreased demand for natural gas saves consumers money: some studies have shown that a 5% reduction in demand could shave 25-35% off wholesale natural gas prices.
- California is already home to several of the nation’s largest manufacturers of solar water heaters as well as dozens of local installation companies which all expect increased business due to this rebate program. Some estimates show that this rebate program will add more than 3,000 jobs to the state in the near term.
“This is a historic new program for California,” said Sue Kateley, Executive Director of the California Solar Energy Industry Association. “California is again leading the way on building stronger businesses and more green jobs.”
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 percent, meaning very little solar energy is lost in the process. The rulemaking (08-03-008) adopted today by the Public Utilities Commission is one of the largest solar water heating programs in the country. The PUC approved the creation of a $250 million fund from a small surcharge on gas bills estimated around 13 cents per month to be disbursed through rebates for natural gas-displacing solar thermal systems. A $100 million pot of money has already been approved from electric ratepayers per the California Solar Initiative adopted in 2006. Those funds will now have a program for disbursing rebates for electric-displacing solar thermal systems.