San Francisco's solar incentive pilot program, expected to be the largest such municipal program in the country, has been put on hold.


Until this week, the program was slated to begin Monday. It would have set aside $3 million in rebates intended to bring 1.5 megawatts of solar installations to the city by offering between $3,000 and $4,000 for residential installations and up to $10,000 for commercial installations.

San Francisco Supervisor Jake McGoldrick, chair of the city board's budget committee, on Tuesday proposed a resolution asking for a report on the Mayor's Energy Conservation Account -- which would have funded the $3 million program -- and to stop spending from the account until a study could be completed.

While a proposal isn't usually enough to enact a resolution -- the Board of Supervisors would normally have to vote to freeze the funds -- the San Francisco Public Utilities Commission put the program on hold until the board could make a decision, according to the county assessor-recorder's office, which sponsored the larger legislation.

Assessor-Recorder Phil Ting on Friday called the delay "a minor setback," although he added that he's concerned any delay will lower solar companies' interest in doing business in San Francisco.

"At this point, we're still working out when the program's going to start," he said. "I have every confidence this program is going to get launched at some point in San Francisco."

Ting said his office is working with all the different parties to try to understand their concerns.

"We're still trying to understand what those concerns are, but I believe we're going to be able to resolve those," he said. "I think we've designed a very workable program that we know [will work] and that is going to produce a significant amount of power in San Francisco. … I think tackling climate change is the most important issue of our time and I don't think investing $3 million of an almost $7 billion budget is too much to turn back climate change."

But even if the program does happen, the delay will have an impact on solar businesses planning to invest in San Francisco, said Nat Kreamer, the president of Sun Run, a residential-solar financing company.

"You're now not going to invest the resources and time in investing those resources as you would have a month ago," he said. "Companies are now delaying decisions because of the uncertainty about whether that incentive program actually exists. … Businesses have to plan. And knowing when something is going to happen is important. Any regulatory uncertainty makes it difficult to plan."

SF Slacks in Solar

While San Francisco enjoys a green reputation, solar installation hasn't been its strong point. The county ranked last among other Bay Area counties in kilowatts of solar power per capita, according to the San Francisco Solar Task Force, with only 744 out of its 195,000 roofs solar-paneled.

That's because the cost of operations is higher and average system sizes are lower in San Francisco, Kreamer said.

By leveling the playing field for residential installations, the financial incentive would make San Francisco as attractive as anywhere else and would establish the city as a renewable-energy leader, he said.

Kreamer called the limbo "disappointing," especially in a week when Southern California Edison announced an $875 million project to install 250 megawatts of solar power in the state's Inland Empire.

"It seemed to be the right time, with the right support in the industry and demand in the marketplace," he said, "and by stopping the pilot program you don't get a chance to find out."

Because California tends to start nationwide trends, slowing the program could end up having effects beyond the city limits, he added.

"People in other locations look to the way programs are structured in San Francisco as a model," he said. "Other states have looked at [the California Solar Iniative] to model their own programs, and I think this is an extension. When the government pulls back, we don't get a chance to see how this works. And other municipalities might wait to see what California, as a more mature solar market, is doing."

The Board of Supervisors also is considering a larger solar-incentive program, which would last until 2016, intended to create more than 50 megawatts worth of solar installations.

According to a board clerk, the committee was expected to consider the program on April 3, but removed the item from the agenda and has not yet settled on a new date.