Feds Put an Early Expiration Date on California’s “Million Solar Roof” Vision

The CSI, or California Solar Initiative was created in 2006 as a part of Gov. Schwarzenegger’s “Million Solar Roofs” vision for the State of California. By installing solar panels, customers earn cash rebates for every watt of solar energy installed on their homes, businesses, farms, schools, and non-profit organizations.

Once installed, solar panels will reduce, or in some cases eliminate, monthly energy bills. Plus the homeowner will have the satisfaction of knowing that they are reducing their carbon footprint and taking a (carbonless) step towards a world powered by renewable energy.

Sound good?

Up until December of 2011, Federal tax incentives made going solar a much sweeter deal. The Stimulus Bill passed in 2009 offered a rebate of up to 30% of the total cost of installation in addition to a property tax break. That is, even though the value of a home may increase due to the addition of solar panels, homeowners would be exempt from an increase in property tax.

The SEIA, or Solar Energy Industries Association, urged Congress to extend the incentive program for another year, stating that it would create 37,400 jobs in 2012 and an additional 2000 MW of solar capacity by 2016, enough to power 400,000 homes.

Congress already extended the program for an additional year back in 2010, however, and the general consensus is that the program will not be given another run, especially in light of the Solyndra bankruptcy.

What does this mean for you?

The CSI is not due to expire until 2016, but homeowners need to act fast to get the most out of the program. The cash rebates offered by the program drop dramatically as demand increases, meaning that the longer you wait to install, the more expensive it becomes.

For the average homeowner, solar panels can cost anywhere from $16,000 to $40,000, depending on usage, climate, and location.

That’s a substantial amount to spend on electricity, but the system does have the potential to pay for itself.

According to a study by the University of California at Berkeley, homes with solar panels sold for an average of $17,000 more per house.

If you’re not planning on moving any time in the near future, well, just think of it as paying up front for your energy for the 25 years.