EVER noticed how high-school daughters want to be as skinny as a rake, tote the latest iPhone and iPad, send a million text messages a month, wear mom's high-heel shoes, and marry Justin Bieber? And, ah yes, along the way they want to rescue stray animals, feed the homeless and, above all, save the planet. Your correspondent's teenage daughter has been nagging him to install solar panels on the roof ever since she was in fifth grade (see “Sunny side down”, February 15th 2008).

Since then, interest rates have fallen, while the price of solar panels has tumbled even more so—thanks to Chinese overcapacity. Meanwhile, electricity rates (at least those in southern California) have risen noticeably. Your correspondent reckons photovoltaic solar systems now cost half as much as they did four years ago.

Two things could make or break America's affair with solar power. One concerns the clean-energy incentives ushered in by the economic stimulus bill of 2009. Many of those temporary tax credits are now coming to an end. If nothing is done to extend them, the incentives will fall from a peak of over $44 billion in 2009 to $16 billion this year and $11 billion by 2014. That could bring the solar-installation business to a screeching halt and wipe out tens of thousands of green jobs. The industry's future depends largely on the outcome of the November election.

The other factor that has been hanging in the balance concerns an arcane energy-accounting procedure known as “net metering”. This is a way of ensuring that people who have renewable-energy sources of their own (eg, solar panels, wind turbines, fuel cells or even hybrid cars) can export any excess electricity they do not need to the grid.

One of the virtues of net metering is that it needs no additional hardware. As modern electricity meters work just as well backwards as forwards, such devices can record electricity fed into the grid as well as that drawn from it. If, at the end of the month, a customer has consumed more kilowatt-hours than he has supplied, he is charged for the net amount. If the reverse is true, he is credited for the surplus. Generally, surplus kilowatt-hours can be rolled over from one month to the next, though any left at the end of the year are lost. In short, net metering provides a way for people who generate their own renewable energy to save money, but not to make a profit.

For the user, the attraction is that the utility credits electricity fed to the grid at the full retail rate. In the past, power companies in America and elsewhere have been required only to make such credits at the utility's own “avoided cost” rate (ie, wholesale price). Why the utilities should choose to credit more than the law requires is because net metering is simple to administer and needs no investment. Meanwhile, it provides them with additional capacity that they have not had to pay for. Solar power, even more than wind power, is attractive in this respect as its peak output is not only predictable from day to day, but also correlates closely with the utilities' peak demand.

Another reason why power companies have gone along with net metering is because it promotes distributed generation—ie, lots of small islands of power scattered throughout the land. That strengthens the grid, especially in rural areas. When loads are high, the voltage at the end of a long distribution line can drop below the threshold level where breakers trip and plunge the whole neighbourhood into darkness. Distributed generation helps keep the lights on.

So, a win-win for users and utilities alike? It would seem so. But the utilities have begun to chafe at having to pay retail rates for privately produced electricity—especially now that rooftop solar has become so popular, especially in California. As the state already has 1.2 gigawatts of solar capacity (out of 2.5 gigawatts across the whole country) and is on track to increase the amount of customer-produced electricity tenfold by 2020, the power companies have been fighting a vigorous campaign to stop net metering taking further hold.

When net metering was introduced 15 years ago, California required the utilities to offer it on a first-come-first-served basis, until it accounted for 5% of “aggregate customer peak demand”. The utility would then no longer have to sign any more contracts. Over the years, 42 other states have followed California's lead.

California's utilities still have a way to go before they reach the 5% cap—equivalent to 2.4 gigawatts of solar capacity. But thanks to recent rock-bottom prices, the pace at which solar panels are now being installed on Californian rooftops means that net metering could bump up against its ceiling as early as next year. That has focused the minds of the state's Public Utilities Commission (PUC) no end.

Some odd bedfellows have been urging the PUC to put an end to the practice of net metering. Apart from the utilities, another leading opponent has been a consumer advocacy group called TURN, which believes that it offers an unfair subsidy to homeowners and businesses that can afford to invest in solar power. In doing so, TURN argues, they impose costs on all other electricity users.

The five-member PUC does not buy these arguments, and voted unanimously last week to interpret the way the cap is calculated so as to allow a further 2.1 gigawatts of net-metered capacity (for a total of roughly 4.6 gigawatts) to be added to the grid—effectively doubling the former 5% limit. The revision stems from the way the original law did not specify how the cap should be calculated. The utilties have interpreted it in a more restrictive manner, which halves the amount of power that qualifies for net metering. The solar industry naturally calculates it more liberally.

All told, the PUC's new ruling provides only a year or two of relief for California's burgeoning solar industry. The issue will need to be addressed more thoroughly in the not too distant future. Half the states that have followed California's lead on net metering deliberately excluded all such limits.

The irony is that those who invest their own money to generate clean electricity from solar panels on their rooftops are likely to be the last to benefit from it environmentally. Nowadays, most people work outside the home during the day and consume the bulk of their residential electricity in the evening and during the night. In California, that is when the state—which meets only 70% of its electricity requirement from its own resources—relies heavily on cheap electricity imported from dirty coal-fired power stations elsewhere in the country. This situation will only be exacerbated if, as expected, plug-in battery vehicles, needing to be recharged overnight, account for an increasing share of the Californian fleet.

That aside, all your correspondent now has to worry about is whether the 31% anti-dumping tariff recently imposed on Chinese solar-panel makers really does deter them. Having seen such trade spats play out many times before, he suspects the tariffs will only spur Chinese firms to acquire the few remaining American solar-panel makers so that they can carry on manufacturing in low-cost Wuxi or Shanghai and do their final assembly in middle America (presumably with local subsidies to boot).

All being well, America's burgeoning solar-installation industry will get on with the job of fitting shiny panels on rooftops. And in due course, another teenage daughter will be able to boast of doing her bit for the planet.