By DAVID R. BAKER, San Francisco Chronicle

California has added enough solar power to its electrical grid this year to light a small town, according to an update released this week on the state's solar rebate program.

SAN FRANCISCO -- Fill 'er up. On us.

Free gas has become the business world's favorite marketing gimmick of 2008, used to sell cars, hotel reservations, baseball tickets and golf clubs.

It's easy to see why.

Californians are still learning to cope with $4 gasoline. Will they soon have to deal with $5?

In the two weeks since California's average price for regular gasoline passed $4 per gallon, prices have jumped an astonishing 42 cents. Some cities have seen increases of 5 cents or more overnight, according to data from the American Automobile Association.

Call it a failure of economics. Even as the cost of crude oil has soared in recent years, the amount pumped from the ground hasn't.

Since the start of 2004, oil's price has quadrupled, from $33 per barrel to $132. Production, meanwhile, has risen just 1.8 percent, to 84.6 million barrels per day.

California should have more than enough electricity this summer to keep the lights on and the air conditioners humming, state officials said this week.

In its annual summer forecast, the California Energy Commission said the state should have 22 percent more power on tap than it would need for a typical summer.

The alternative energy business is starting to make real money.

Worldwide sales for companies specializing in biofuels, wind farms, solar panels and fuel cells grew 40 percent in 2007 to reach $77.3 billion, according to an annual report issued by Clean Edge, a research firm that studies the green technology industry.

California is blessed with many renewable sources of energy, from surging Sierra rivers to strong coastal winds.

Now, add another source to that list -- cow manure.

SAN FRANCISCO -- The green tech revolution that promises new, clean sources of energy seems to be spreading everywhere -- including the oil-rich Middle East.

An annual conference of green companies and investors in San Francisco this week illustrated the young industry's global reach.

These should be the best of times for Big Oil.

Petroleum prices have tripled in five years, and gasoline prices reached record heights last summer. International oil companies are making the kind of money most capitalists can only dream of.