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LOS ANGELES – Buoyed by generous government subsidies and plummeting costs, solar power is enjoying a rare day in the sun. 

In places like sun-kissed California, the energy source that once languished on the economic fringe is now carving out a booming niche among consumers hamstrung by high electricity prices and the threat of blackouts. 

“As the energy problems in the United States increase, it slides more into the mainstream,” said John Thornton, a principal engineer in the National Renewable Energy Laboratory in Golden, Colo. 

The situation has sent a jolt through sales of solar power equipment. 

Domestic shipments of photovoltaic cells increased 74 percent during the two-year period ending in 2000, according to the federal Department of Energy. That’s enough equipment to generate at least 75 megawatts of power at peak usage times. One megawatt can power 750 average homes. 

The DOE projects that total could reach 3,200 megawatts by 2020. 

Meanwhile, the price of those cells continues to fall; they now cost just 20 percent of what they did 25 years ago. Rooftop systems that can meet half a home’s electricity needs for more than 20 years now cost as little as $10,000 with rebates and tax credits available from the federal and state governments. 

“You’re talking a five- to six-year payback range in California, compared to 20 a few years ago,” said David R. Lillington, president of Sylmar-based solar cell manufacturer Spectrolab Inc. 

Dan Kammen, a professor in the energy and resources group at the University of California, Berkeley, said it’s the first time that solar power systems can be justified economically. “Before it was just a good idea environmentally,” he said. 

Photovoltaic cells produce electricity when struck by sunlight, and a portion of that energy is absorbed by a semiconducting material such as silicon. That knocks loose electrons, sending them coursing through the material. The current can then be drawn off as a source of power. 

Photovoltaic output peaks when demand for electricity and the wholesale price of power both spike – typically on hot, sunny days. 

But even today, three decades after those cells were first made available on a commercial basis, photovoltaic systems still produce less electricity at a greater cost than all other significant means of generation. 

Solar power contributes just 0.02 percent of the total amount of electricity fed into the nation’s grid. And even at its cheapest, it costs 20 cents per kilowatt-hour to generate, or roughly four times as much as electricity produced from fossil or nuclear fuels on average. That makes large-scale plants unfeasible, experts said. 

“From an electric utility standpoint, it’s developing, it’s being used, but the technology costs have to come down more for it to be more usable,” said Jayne Brady, a spokeswoman for the Washington, D.C.-based Edison Electric Institute, which represents shareholder-owned utilities. 

Still, for individual homeowners like Karina Garbesi, an assistant professor of geography and environmental studies at California State University, Hayward, the rooftop panels can be an attractive alternative. The system atop her Bay Area home regularly produces excess electricity that she can sell to her utility. 

“My meter runs backward during the day,” Garbesi said. 

In housing developments being built in places like San Diego and Sacramento, solar panels are now standard in some new homes, their cost factored into the sale price. 

“We’re seeing more use of photovoltaics in new construction,” said Joe Wiehagen, an engineer with the research center of the National Association of Home Builders in Maryland. “It can be a bit less expensive in a new home and you don’t have to worry about working it into your mortgage because it’s already there.” 

Subsidies also make the capital costs of the systems less prohibitive. 

At the Los Angeles headquarters of Neutrogena Corp., officials recently installed a 200-kilowatt system that should cut the amount of power the firm buys by 20 percent, said Senaka Nanayakkara, the cosmetics company’s director of facilities. 

The Los Angeles Department of Water and Power ponied up $1 million of the system’s $1.4 million price tag, as part of its program to add the equivalent of 100,000 residential rooftop solar systems by 2010. 

Similar subsidy programs should continue to drive down prices and prevent the solar power industry from foundering as it did in the 1980s, when fossil fuel prices fell and interest in emerging alternative energy sources waned. 

“We could still screw it up. Yank price supports and you could drive industries out,” Garbesi said.