Here's a power paradox: a federal government incentive that uses money from the carbon tax helped contribute to SaskPower's suspension of its solar panel net metering program.

The federal money comes from a portion of the fuel-charge revenue in provinces like Saskatchewan that have a federally imposed carbon tax. After the incentive was put in place on July 17, interest in the net metering program spiked so quickly that it reached its 16-megawatt cap and was suspended two years sooner than it might have been.

The net metering program — which allowed SaskPower customers to generate their own electricity with solar panels and receive credit for any excess they generated on the provincial grid — was slated to run until 2021 or the 16-megawatt cap, whichever came first.

SaskPower said the program was still below seven megawatts as late as June 30, but by Aug. 31 it had hit 11.45 megawatts. It reached the cap on Sept. 19.

In a Sept. 18 news release that warned the cap would soon be hit, SaskPower CEO Mike Marsh said that the utility had seen "a dramatic increase in uptake in the program in recent weeks, driven in part by federal funding that applies to large net metering projects."

The Crown corporation said since July, the average size of applications into the net metering program increased by 80 per cent.

On July 17, the federal government announced small and medium-sized businesses could apply for funding for energy-saving projects in several provinces, including Saskatchewan.

SaskPower CEO Mike Marsh said an uptake in net metering interest was due "in part" to federal dollars tied to incentives derived from the carbon tax. (CBC)

"The program is expected to fund projects such as solar panel installations on farms and energy-efficient upgrades that will help make small- and medium-sized businesses more productive and competitive," a federal government spokesperson said.

Applicants were eligible "to receive funding of up to 25 per cent of the cost of projects that will make their businesses more productive and competitive as they reduce energy use, save money and cut greenhouse gas pollution."

According to Environment and Climate Change Canada, 490 applications for the small- and medium-sized incentive fund have been received as of Wednesday. Of those, more than 170 were received from Saskatchewan.

"Businesses were taking advantage of that and using federal funding on top of the rebate from the province of Saskatchewan to install larger systems," SaskPower spokesperson Joel Cherry said last week.

TruGreen Energy president and CEO Miguel Catellier said it's "super ironic" that money from carbon tax revenue is what caused an increase in solar demand in the province. (Emily Pasiuk/CBC)

The province's rebate is approximately 20 per cent of the total system cost. The maximum rebate is $20,000.

In July, Regina solar installation company TruGreen Energy told prospective customers to apply and take advantage of the 25 per cent federal incentive and SaskPower's rebate.

TruGreen Energy president Miguel Catellier does not dispute SaskPower's claim that the average size of applications increased by 80 per cent.

"Customers took advantage. [SaskPower] got an influx of much larger systems," Catellier said.

He would know: his company helped businesses apply for the incentive.

Regina company TruGreen Energy wrote this post in July, encouraging businesses to apply for the federal incentive. (Submitted by TruGreen Energy)

He called it "super ironic" that money from carbon tax revenue is what caused an increase in solar demand in the province.

A spokesperson for the federal government said decisions regarding applications won't be made until after the federal election, Oct. 21.

Catellier said the incentive could disappear if the Liberals are defeated, which could also mean a reduction of the solar projects that pushed the program to its cap. The 16 megawatts could be reduced by three or four megawatts if the federal incentive is gone and businesses who applied back out, he said.

Catellier said he hopes the provincial government will "guide the Crown utility to do what the public wants. People want to reduce their emissions, to lower their power bill and to put solar panels on their roof."

SaskPower said last week the cancelled program would have required a seven per cent increase to all rate-payers in order to continue. The minister responsible for SaskPower, Dustin Duncan, said the government would have a replacement for the net metering program "within weeks, not months".

TruGreen Energy will take part in a climate rally set for Friday in front of the Saskatchewan legislative building.

"We believe solar plays an essential part in the equation of climate change, and we believe we should have the option for 1:1 net metering in Saskatchewan!" a company statement said.

Catellier said killing net metering altogether would "kill a whole lot of jobs". He said 57 companies are in the province installing solar.

"We have nothing to do but fight for our jobs at this point," he said.

A petition called Save the Solar Industry in Saskatchewan had received more than 10,000 signatures as of late Thursday afternoon.

Earlier this week, youth climate activists from Fridays for Future said they hoped to see Premier Scott Moe and Duncan at the rally. Both said they had prior commitments.