TEP runs out of incentives for home solar systems

Sep 14 - McClatchy-Tribune Regional News - David Wichner The Arizona Daily Star, Tucson

Tucson Electric Power Co. has stopped accepting new applications for residential renewable-energy incentives through the end of 2011, after a recent surge in reservations.

The company said it received completed applications for more than $2.2 million of incentives for residential photovoltaic systems in the first week of September, compared with an average of about $1.1 million per month this year.

TEP ratepayers pay monthly surcharges to fund the incentives, which are reserved on a first-come, first basis until all funding is obligated. About $14 million was budgeted for residential incentives this year.

This marks the earliest TEP has run out of renewable-energy incentive funding, TEP spokesman Joe Salkowski said, noting that 2010 incentives were available nearly through the end of last year.

In 2009, state regulators approved the utility's request to lower per-watt incentive rates to stretch available funding through the end of the year.

The recent surge in residential applications was driven largely by reservations for leased systems, which are owned by leasing companies but get the same incentives as customer-owned systems, Salkowski said.

TEP as part of its 2012 renewable-energy plan has proposed cutting incentive rates for leased systems.

TEP will not start a waiting list for 2012 until after the Arizona Corporation Commission has made a decision regarding the availability of incentives and funding levels for each system type.