Jan 16 - McClatchy-Tribune Regional News - Larry Rulison Albany Times Union, N.Y.


The solar industry is up in arms about cuts to state incentives for solar electric systems and wants state regulators to provide immediate funding.

On Monday, the New York State Energy Research and Development Authority reduced the state's cash incentive for solar electric, or photovoltaic, installations from $2.50 per watt to $1.75 per watt. It also made solar installations ineligible for a special loan program.

The reductions, which NYSERDA officials say merely bring the state's program down to the level of neighboring states, come as the state Public Service Commission is set to debate how much it wants to fund its photovoltaic program in the future.

New York spent $22 million on photovoltaic incentives in 2008, but that ballooned to $58 million last year as demand escalated. The money is paid to certified installers so they can lower prices for customers.

Equipment and installation can cost tens of thousands of dollars. A typical system of 4.5 kilowatts averages roughly $8 per watt, although it can be as low as $6.

Staff at the PSC have run two scenarios in which the level of funding could be set at $24 million a year for the next five years, or as high as $50 million.

However, since funding technically was not extended through 2010 yet, NYSERDA has been using money from various sources to keep funds flowing. But a decision was also made to curtail the cash incentive level to ensure the agency does not run out of money.

The incentive money is authorized through what's called the Renewable Portfolio Standard, a state program designed to increase renewable energy production in the state. The money comes from a fee paid on electric bills.

There are also federal and state tax breaks on photovoltaic systems -- more commonly called PV systems -- that will remain in place, and the state also has other programs in place to support the solar industry. NYSERDA also said this week it is providing $10 million in incentives for installers from the federal stimulus program.

"This will continue to sustain and stimulate PV use," said NYSERDA spokesman Jeffrey Gordon. "There is a very strong commitment from the administration to solar development."

The New York Solar Energy Industries Association said on Tuesday that it wants the PSC to authorize $4 million a month in "bridge funding" for the program until the commission can decide on the new funding levels.

"The cutbacks will critically damage the growing base of small- and medium-sized solar businesses in the state," NYSEIA President Ron Kamen said in a statement.

PSC spokeswoman Anne Dalton declined comment on what actions the commission might take, but she said that the PSC is scheduled to talk about the Renewable Portfolio Standard at its next meeting on Tuesday in Albany.

Larry Rulison can be reached at 454-5504 or by e-mail at lrulison@timesunion.com.

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