The Solar Colwood plan aimed to entice 1,000 households to convert to solar energy systems through rebates, but so far only 33 households have signed up.
It costs between $8,000 and $10,000 to convert the average home to solar-powered hot water, but residents can get up to a third of their costs reimbursed under the Solar Colwood program.
Researchers say the low price of energy means the conversion cost may not be recovered for up to a decade.
But Royal Roads University energy expert Chris Ling believes Colwood residents should get on board.
"It may take you a certain length of time to get your money back on your investment, but we're projecting energy prices going up by quite a few percent every year, so five years down the line, who's to say it's not going to be a better deal but then the incentives aren't going to be there anymore,” he said.
“The benefits may be a bit intangible at this stage, but it’s also an opportunity for experimentation — nothing of this scale has happened in Canada."
The Solar Colwood project received close to $4 million from the federal government two years ago.
Funding for the pilot project is set to expire early in 2014, but the municipality is asking the federal government to extend it until the incentive money runs out.