Southern Nevada has plenty of sunshine and solar power, but companies installing solar power systems are dealing with a shortage of photovoltaic panels.

Photovoltaic panels, which typically are made of silicon, can convert sunlight directly into electricity, and Nevada is encouraging installation of more photovoltaic systems to reduce power use.

Under state law, Nevada Power Co. of Las Vegas gives residential, commercial and small-business customers a rebate of $3 for each watt of electricity produced by photovoltaic panels.

At the same time, Germany and Spain are offering their citizens financial incentives for installing solar systems, too, and that has created a shortage and driven up prices, said Chris Brooks, renewable energy director at Bombard Electric Co., a large electrical contracting company.

Spain has budgeted the equivalent of $832 million for its renewable-energy program and set a goal of increasing the renewable-energy use to 12.1 percent by 2010, up from 6.9 percent at the end of last year, reported Renewable Energy Access, an online renewable-energy news site.

“The demand is high and, as a result of high demand, there is a long lead time for this product,” said Bob Balzar, renewable energy and conservation program director at Nevada Power and its sister company, Sierra Pacific Power Co. of Reno. “Manufacturers are working very hard to keep up with demand.”

The shortage in photovoltaic systems has boosted prices 15 percent to 20 percent over two years, Brooks said, although earlier this year he had expected prices for photovoltaic systems to decline.

Some electrical contractors are having difficulty getting photovoltaic panels, but Bombard has been able to secure panels from Kyocera and Sharp, two Japanese manufacturers.

Residential customers of Nevada Power can qualify for up to $15,000 in rebates for installing solar panels. The maximum rebate would be for a typical $45,000 system capable of producing 5 kilowatts of electricity. Small businesses may receive up to a $90,000 rebate for a 30-kilowatt system, Brooks said.

Rebates for the current year are already assigned. The next round of solar rebates will be available after July 1 and, by then, Bombard expects to have the necessary panels.

Homeowners also can qualify for federal income tax credit up to $2,000 by installing solar systems over the next two years, the Solar Energy Industries Association reports.

Most buyers are interested in the environmental benefits of solar systems, Brooks said. Unlike conventional power plants, solar systems create no pollution .

Also, homeowners may like the independence they get as well as the ability to lock in some power costs, he said.

If electric power rates continue escalating at their current pace, Brooks figures that a homeowner will be able to recover the cost of a system within 12 years.

Homeowners with solar systems are able to avoid paying for some or all of their electrical needs when the sun is shining.

If they generate excess power, Nevada Power credits them for a like number of kilowatt hours. Excess power generation can be banked for as long as a year.