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California Will Require Solar Panels on New Homes

Updated: Sep 8, 2018

The state of California took a giant renewable energy leap recently, requiring all new homes to have solar power. This new regulation is to be put into effect in 2020.

California home with solar panels



The California Energy Commission voted unanimously 5-0 to improve the building energy standard. The most notable of this standard is the requirement for all new houses to have solar panels starting in 2020.

The commission estimates the rules will lead to a reduction in greenhouse gas emissions equivalent to 493 million pounds of carbon per year. That's roughly equivalent to taking 50,000 cars off the road.

"This is a huge milestone for distributed solar. This could ultimately drive down the price of rooftop solar by building expertise in the roofing and home construction industries, creating incentives for home builders to streamline their building and solar designs to minimize cost, resulting in a virtuous cycle"

said Mike O'Boyle, electricity policy manager for Energy Innovation, a San Francisco think tank.

New Energy Standards Beyond Solar

In addition to the solar requirement, this new code includes:

  • Updated energy efficiency standards, which, combined with solar panels, aims to reduce net electricity use to zero.

  • Ventilation standards to improve indoor air quality.

  • Lighting standards for commercial and industrial buildings, with the goal of reducing energy used for lighting by 30 percent.

This code builds on to a previous building code that was put into place in 2014. That required new houses to have roofs and electricity systems that are ready for solar.

Current Laws

There are current laws that are in California that are also contributing. For instance, new California state legislation will require that 60% of all the state's electricity to come from renewable, clean energy by 2030 (currently, it is 50%). They are waiting the governor's approval.

San Francisco has a similar law that requires all buildings under 10 stories to be powered by solar. This, combined with the new statewide law, could help San Francisco reach its goal.

California state legislation is also requires that 100% of California be powered by clean energy by 2045. This legislation is also about to be signed by the governor of California.

Issues and Their Solutions

There are a couple issues with this new law that have been taken into account. One issue is the fact that this will add thousands of dollars to new homes. The construction companies have embraced the new requirement, making it a selling point for new homes. However, it does provide a few options. One is that they could install solar panels on top of every house. The other option is to install a mini solar farm that powers a group of houses. 

If there were rooftop panels, it could be bought outright or rolled into the cost of the house. Either way, it is expected to add to the value of a house by $8,000 to $12,000. California lawmakers argue that they will not have to pay for heating and electricity bills. This statement has been backed up by a study done by the Energy Commission.

The Energy Commission Study

This study estimates that, for the average residential homeowner, will add $30 each month for a traditional 30-year mortgage. However, they also estimate that these homeowners will save over $110 a month on heating, cooling, and electricity (minus the extra $30, so about $80 savings). 

The Impact

There is going to be a significant positive impact, with studies estimating that within a year, the number of rooftop solar panels will increase 44% once the requirement starts. The state of California is part of the We Are Still In Coalition, so they are trying to follow the Paris Climate Accord even though the federal government has pulled us out of it.

There is also a possibility that solar panel prices could decrease. This is because of the high demand. That means that the number of $8,000 to $12,000 could go down.

This may also help other parts of the economy. The solar industry will grow, which will make them hire more people and therefore overall help the economy. In addition, it will help small startup solar companies.

Can, and Will, Other States Follow?

California has a history of being a pacesetter for environmental standards. If its solar rules are viewed as a success, as the state commission expects, the next question is how other states might follow California's lead.

"We want a lab for developing policies that can then be adopted by other states and basically move forward with building efficiency nationwide"

said Pierre Delforge, a senior scientist for building decarbonization at the Natural Resources Defense Council (NRDC) who was involved in crafting the California rules.

Delforge is looking to the International Energy Conservation Code (IECC), a model code that is used for the basis of many state's policies. He says that the "logical next step" for the IECC is to implement elements from California's rule.

It is less likely that other states would immediately try their own solar requirement than the IECC. California is uniquely positioned to be the first because it already has a thriving rooftop solar infrastructure, and because of laws that give the energy commission broad power over building rules. This makes it really easy to implement these climate regulations.

"Whether this proposal takes off in other states comes down to a few threshold questions. If California can integrate this policy seamlessly and efficiently, then there's no reason other states can't follow"

said O'Boyle of Energy Innovation. Those questions come down to how the grid can adapt to a much larger presence of solar, and whether the long-term economics turn out to be as favorable as predicted.

Abigail Ross Hopper, president and CEO of the Solar Energy Industries Association, said in a statement that

"Other states may not be ready for this step yet, but this is a precedent-setting policy—one that will bring enormous benefits and cost savings to consumers. It is my hope and belief that when other states, many of which are developing rapidly growing solar markets of their own, see the benefits of this policy, they will develop similarly aggressive policies"


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