Solar Industry Layoffs Hinge on Rebate Revival


"Utility argues incentives are no longer necessary; competitors have nosedived."

Colorado's solar-energy installation sector warned Friday of job cuts and business failures as state regulators ordered negotiations on Xcel Energy's controversial suspension of an incentive program.

The Colorado Public Utilities Commission has given Xcel and solar officials until Thursday to craft a settlement on whether the rebate program should be resurrected and at what level.

If the parties can't reach an agreement, the PUC will consider issuing its own order on the program, which offers rebates and credits to customers for installation of small-scale solar electric systems.

Solar-energy representatives said their businesses have nosedived since Xcel announced Feb. 16 that it was cutting the incentives by at least 15% and up to 47% pending regulatory approval.

One day later, Xcel said it was suspending all rebates until the PUC ruled on its incentive-cutting proposal.

Solar-industry officials said half of the sector's 5,300 jobs in Colorado are at risk.

Namaste Solar, one of the state's largest installers, has laid off 12 workers—16% of its workforce—since the incentive program was suspended.

Xcel Energy said the costs of solar panels have dropped sharply in recent years and customers no longer need big rebates to justify system costs.

The utility said that in 2010 it collected about $50 million from the bill charge, yet paid out $67 million in incentives. This year, it projects the payout at $97 million, even at reduced rebate levels.

The Colorado Solar Energy Industries Association recently filed an emergency motion with the PUC, seeking an order to reinstate the incentive program.

PUC commissioners did not rule on the motion, instead asking the two sides to negotiate a settlement over the next week.

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