LI solar-panel rebate program to be run by state

New York State plans to take over management of a popular solar-panel rebate program long handled by LIPA, and more recently PSEG Long Island, with a road map to end rebates in 2017 or sooner.

The rebates help defray part of the tens of thousands in dollars of costs to put solar panels on customer rooftops -- on homes, schools and libraries, offices and churches. The amount paid in rebates to Long Island electric customers has declined in recent years, as the number of solar participants has increased to more than 7,000 of PSEG's 1.1 million customers.

In a filing with the state Public Service Commission earlier this year, the New York State Energy Research and Development Authority requested that Long Island's program come under its statewide solar rebate program as part of an expansion of Gov. Andrew M. Cuomo's NY-Sun solar initiative. The 10-year NY-Sun program would have a $960.5 million budget.

The plan proposes setting aside $28 million in state funds to operate the Long Island rebate program until 2017, when it would cease. PSEG Long Island has already earmarked $10.7 million for the rebates this year. The combined $38.7 million is projected to fuel the market to a self-sustaining level. "There will be no rebates at end of this because we would have grown the industry to live without rebates," a Cuomo administration official said.

Applications for solar rebates would be processed through Albany-based NYSERDA, not the local utility. Some installers predict the new $28 million Long Island funding could be expended sooner than 2017, given the popularity of the programs here.

The state plan envisions Long Island residential, municipal and small-business solar installations would add around 107 megawatts of new solar installations before rebates ceased. The rebate, currently 66 cents a watt for systems of as much as 10,000 watts (or a maximum residential rebate of $6,600), would be reduced as megawatt milestones are achieved over the four years.

The plan would mean that PSEG Long Island, which took over the Solar Pioneer program from LIPA when it took charge of the system in January, would cede control of a renewable program that was a cornerstone of its appeal in taking on the LIPA system. The plan envisions a changeover of management as early as April.

PSEG Long Island spokesman Jeff Weir would only say that PSEG for now continues to administer the program.

Long Island solar-panel installers, who were briefed on the plan last month, expressed mixed feelings about it.

"The paperwork with LIPA is a nightmare, but NYSERDA is no bargain either," said Kevin MacLeod, owner of KPS Solar in Bay Shore and vice chairman of the Long Island Solar Electric Industry Association. "My concern is NYSERDA is going to take over the program and is not willing to communicate with us."

Sail Van Nostrand, owner of Energy by Choice, a Northport installer, said moving to state administration could remove the uncertainty of annual budget changes by LIPA and PSEG, which this year reduced the rebate program to $10.7 million. Gordian Raacke, executive director of Renewable Energy Long Island, a solar proponent, said he believes the $28 million over four years is "probably not enough."

He noted that a federal tax credit of 30 percent is set to expire at the end of 2016, and if it's not renewed, two important solar incentives could disappear by 2017. "It may be too rosy a picture that NYSERDA is proposing at this time," Raacke said.

Van Nostrand agreed that expiration of the federal tax credit is a potentially larger issue for installers. "If it were to disappear that's a significant factor," he said.

Long Island Solar Rebates 2000-2014

Total value of rebates: $164.6m

Homes with solar panels: 6,862

Commercial/municipal solar panels: 1,006

Total installed energy production: 66.5 megawatts

Source: PSEG Long Island