Thursday, February 19, 2009
The economic downturn has hit all San Diego county industries hard. But one sector is poised to shine as the economy recovers. KPBS Environment Reporter Ed Joyce says the local solar power industry is a bright spot on a dismal economic landscape. It's the fourth part of our series Rough Water: Navigating San Diego's economy.
(Photo: The Stone Brewing Company in Escondido gets up to 43 percent of its electricity needs from the sun.
Borrego Solar )
Stone Brewery Server
: They want two four ounce tastes of the cask lightning old tempest and two pale ales.
As people at the Stone Brewing Company in Escondido tip their glasses to sip on the company's ale, they may not know that the some of the electricity used to brew the beer and keep it cold comes from the sun.
Server: All right, I have the Stone Pale Ale for you m'am, the Stone Pale Ale for you.
Steve Wagner is the President and Brewmaster of Stone Brewing Company.
He decided to take advantage of financing incentives available last year to cover his roof with solar panels.
(Photo courtesy of Borrego Solar)
Wagner estimates the system has saved the company between $40,000 and $50,000 in electricity costs over the last six months.
Wagner: When you combine the rebates and the tax credits and things like that it ends up being about a seven year payback for us. Which is a little bit longer than we're used to doing. But you know because it's something that we want to do and it's the right thing to do. It's something that we could handle.
Wagner says despite the down economy, the company would likely go ahead with the project today because he wanted to reduce the company's carbon footprint.
Borrego Solar Systems of El Cajon put in that rooftop solar system.
CEO Aaron Hall says the company will get through the economic slowdown.
Hall: Right now unfortunately the large project market is almost frozen, there's a lot of delays. That said, Borrego is performing on projects. We're doing universities, we are doing corporations. Some of the work is left over from projects that we had started last year but we are signing up new projects.
He says the tight economy means smaller companies and homeowners may be less likely to invest in solar over the short-term.
Hall says an improving economy could create more jobs, allowing Borrego to add to its staff of 135.
Despite the economic slowdown solar companies based in San Diego County see brighter days ahead.
Noble: We're very optimistic about the future of solar and especially our part of the solar industry which is solar-integrated building systems.
Robert Noble is the founder and CEO of Envision Solar.
(The solar array at Kyocera glows at night. Envision Solar)
Having said that the economy and the downtown in the economy has greatly affected our business because it affects our customers, our clients. Whether it's a public agency or a commercial developer or a university, doesn't matter who it is, they're all affected so they're looking just at the bottom line.
Noble says project financing or funding for solar development is drying up and companies like his have to work that much harder to raise capital for expansion.
But three factors give him optimism: The costs of solar panels have dropped as much as 30-to 40 percent; solar companies have reduced their own costs; and the companies are getting more efficient in the installation of solar, also cutting cost.
Cardiff Developer John DeWald says creative financing is making solar more affordable now rather than a multi-year payback.
He points to an Encinitas project as one example of that strategy.
DeWald : For instance at Pacific Station we've actually working with a solar manufacturer where they're going to install and own the systems and sell the power back to our residents for 15-20 percent off their normal bills. It doesn't cost the residents any money.
DeWald says integrated roofing systems - where solar doesn't stand out - could become more common.
DeWald: We've got a partner who's looking at going back to apartments and condos and saying "when it's time for you to replace your roofs we can do it with solar at the same price or cheaper." So I think that's going to spur some additional jobs from that perspective.
The solar industry has relied on government incentives to grow the business.
Andrew McAllister with the California Center for Sustainable Energy says there are roughly 1100 solar installer/contractors in San Diego County.
He says new federal and state incentives will provide an added boost for solar businesses.
McAllister: New sources of financing, streamlined programs, stimulus from the federal government will I think make the solar industry grow this year. So, on the one hand the baseline doesn't look good because the economy is down. But on the other hand, there are lots of opportunities to bring innovative financing mechanisms to these projects, particularly for solar.
The solar industry uses terms such as bright, sunny and glowing to describe the industry's future.
After all, they're banking on the sun.
But when that future sparkles depends on how soon the economy recovers.
Ed Joyce, KPBS News.