City Council looking to offering alternative-energy incentives to some DWP customers

For some Angelenos, living off the power grid comes at a steep price - but a new proposal could soon make it worthwhile.

An estimated 3,000 local residents have converted their homes to operate solely on solar power, at a cost that can run into the tens of thousands of dollars.

The main benefit is there is no more angst over steep electricity bills from the Department of Water and Power. But city officials are looking at offering more incentives, such as reimbursing homeowners who generate enough power to sell some back to the DWP grid.

Councilwoman Jan Perry, chair of the council's Energy and Environment Committee, has proposed a pilot program that would generate 75 megawatts a year, enough to power about 1,000 homes.

"This is the first brick in the foundation," Perry said. "We need to find a way on how we can do this without placing a burden on our ratepayers."

Currently, the state's Solar Incentive Program provides credit to customers who feed power back into the system. But that program will be phased out soon, so the city is looking to establish its own, permanent program.

A "feed-in tariff" could eventually produce the equivalent power of building a new plant, but without the costs, said DWP General Manager Ron Nichols.

Right now, Nichols said, the estimated

3,000 people in Los Angeles who rely on solar power in their homes generate 27 megawatts of power. At least two of them are current City Council members.

Councilman Greig Smith has been living off the grid since 2008, when he installed a solar system at his Granada Hills home.

"We are basically producing enough power to sustain my home," Smith said. "There isn't a lot of extra power being generated that we could sell."

He said the system, which cost $80,000 to install, has operated with no power interruptions - and no DWP bills.

Smith said the overall cost was reduced through rebates and tax breaks, but he recognizes how difficult it would be for most people to pay for such a system.

"I would like us to look at a system where we loan people the money to install a system and then put the costs on their property bills," Smith said. "That way, we can stretch out the payment for 10 or 20 years."

The Los Angeles Business Council has embraced a broad program that they are calling CLEAN Solar to have solar power panels on roofs of large commercial buildings and apartments.

Mary Leslie, president of the Los Angeles Business Council Institute, does not see the feed-in tariff as the most effective option.

"At this point, the feed-in tariff concept doesn't make much sense for homeowners," Leslie said. "What they need is a net metering program that shows how much power they are using and what they are giving back."

But, she said, studies conducted for the Business Council by UCLA and others show there is a huge market for solar panels on multifamily and commercial buildings.

"Where it can have a tremendous impact are on multi-family, low-income properties," Leslie said. "They can generate 1 gigawatt of power. What that means is no utility bill for tenants. They could spend that money on services they need."

Also, Leslie said there is a huge potential market on commercial buildings.

"It will be effective throughout the San Fernando Valley, the Alameda Corridor and South Los Angeles," Leslie said. "They will be able to generate a lot of the power we need."

Nichols said Gov. Jerry Brown recently signed AB 32, which requires all utilities to generate 33 percent of their power from renewable sources by 2020.

City Council President Eric Garcetti also has been living off the grid and thinks it is worth it.

"For the average homeowner, I think it is well worth it," Garcetti said. "I think they will get the payback in two or three years and then they will be making money by supplying power to the grid.

"There is no feeling like coming home and seeing the meter go backward because you are selling power."

Garcetti said he spent $10,000 for the solar panels on his house and he believes the costs will come down as more people install the panels.

Solar experts estimate the cost of a system is about $5 a watt, so a 10 kilowatt system would cost roughly $50,000 to install. One website that allows people to determine the costs and benefits of a solar system is pvwatts.org.

Carol Grow Sarah Shahi Sara Foster Kate Moss Amanda Marcum