Tuesday, July 12, 2005

Prevailing Wage Could Kill Solar Initiative

If the Governor is going to get his Million Solar Homes initiative passed, it will be without the help of the GOP caucus. Knowing that, Democrats are extracting concessions from Schwarzenegger, but they could go a bridge too far.

Solar's future is bright, but in the bowels of the Legislature, business remains murky. There, labor unions are demanding that private contractors pay "prevailing wages" to workers who install solar panels as part of SB 1, the governor's legislation to help provide solar energy to 1 million homes.

Industry unions have won important victories for their members in recent years, but in this case, they are going too far.

The prevailing wage demand could kill SB 1. All state construction projects must now pay prevailing wages. Now the unions want those wages -- effectively union wages -- to apply to any large-scale development that receives a state subsidy. It's a costly precedent, one that would destroy the basic economics of the governor's plan.

If they were forced to pay prevailing wages, solar industry leaders say it would drive up the total cost of a photovoltaic system by 15% to 40%. Homeowners would be less likely to opt for solar panels. California citizens, including union households, would be deprived of a technology that could create 3,000 megawatts of clean power by 2018.