The current fiscal year’s $1.6-million budget for the program — culled from proceeds of the public benefit charge to all customers — had earmarked half the available funding for residential projects.
But in January, the utility received so many applications for the rebates that officials had to close the entire program to new participants through July, officials said. Some customers remain on a waiting list.
“The program has literally been on hold,” said General Manager Glenn Steiger, who attributed the growing demand to the dropping price tag for installation and the growing visibility of solar energy systems.
Under the state legislation, the utility can spent up to $15.2 million through a 10-year period — a cap based on the utility’s share of the statewide municipal utility load.
So with the inability to commit more funds to the rebate program, the City Council on Tuesday voted to reduce the individual rebate level, which utility officials said would be in line with incentives offered by neighboring agencies and allow more customers to participate.
The incentive rates for small and large installations will drop by nearly 40% for the next fiscal year. The rebate level will then be reduced by an additional 7% in each consecutive year.
Under the current rebate level, a customer installing a 15-kilowatt system would receive a rebate check of $48,300. Under the new levels, that rebate would drop to $30,000 next year.
Councilman Frank Quintero criticized the state legislation, which he said should allow for additional incentives.
“It’s just beyond belief that rather than giving people more and more incentives for solar installations, in fact we are pulling back,” he said. “That was a bad idea.”