Solar City project hurting businesses it was supposed to help

by Brian DuBreuil Posted: Jun 22, 2012 11:51 AM ET Last Updated: Jun 22, 2012 11:51 AM ET

Here's a question for you: you are a civil servant with an innovative new program that will benefit both the environment and local business. Do you A) unveil the program, get tons of people to sign up and then hope you'll get the money somewhere to pay for it, or B) make sure you have the financing in place before you go public?

The people behind Halifax's Solar City project went with option A and so far, the whole thing has not only been a major disappointment, it is actually hurting the very businesses it was supposed to help.

As we reported this week, more than a year and a half after it was unveiled, there is still no money to start buying and installing solar panels on homes throughout the city (under the program the city would pay for the panels up front with the costs amortized over time on the homeowner's property taxes).

I spoke with three different solar panel dealers about this story. Every one of them was shocked to hear the city still didn't have the $6 million it needs to get the project off the ground. They all assumed that when the program was announced the city either had the financing already secured, or had firm assurances they would get it.

That wasn't the case and their business is suffering because of it.

When the project was announced the response was so overwhelming the city had to cap the number of applications at 1,600. Those homeowners are still waiting to hear if the project is a go. In talking to these folks, dealers say even some of the most committed are holding off to see if they'll get financing from the city before buying. For the solar dealers that's hundreds of potential customers - but few orders. As one dealer confided to me this week "we are barely holding on".

A friend of mine who is a successful salesman has a saying that goes something like "nothing kills a sale like time." Eighteen months after homeowners rushed to sign on to Solar City, people in the industry are worried the long delays will have dampened the enthusiasm.

To make matters worse the financial incentives aren't nearly as attractive.

When Solar City was first unveiled, homeowners who installed solar panels would have qualified for rebates totaling more than $3,700, almost half the cost of the job. But Ottawa has since cancelled its program, so the only one available now is a $1,250 rebate from Efficiency Nova Scotia.

Solar City isn't dead yet. The city is still hoping to secure financing from the Federation of Canadian Municipalities (although it initially rejected the request), and city staff are preparing a report for next month's council meeting that could give councillors other options to save the program.

Everyone involved is hoping it can be saved. Solar City is an innovative program that has attracted attention around the world. But by unveiling it before they had the money in their hands to pay for it, a project that should have made Halifax an environmental leader, has so far, only succeeded in hampering the growth of solar energy.

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