Way back in 2018, California’s Building Standards Commission swore in a new piece of legislation completely unique to any previous law in the United States. In an effort to draw 100% of state electricity from renewable resources, the government mandated that solar panels would be required on all new residential buildings with 3 stories or less. Flash forward to 2020, and law is now in effect.
In this article, we are going to fully outline the state solar requirements for commercial and residential development. After an in depth view of the new AB-178 California solar mandate, we will outline other state solar laws and cover a few frequently asked questions.
Cal Solar Inc is a full-service, large-scale solar developer in Los Angeles, Oakland and San Diego. For those looking for answers about California’s new solar requirements, we are here to help.
California’s Solar Mandate: Assembly Bill 178
As of Jan 1, 2020, solar panel requirements are now officially being enforced on all new structures built in the state of California. Governor Gavin Newsom has signed in Assembly Bill 178 (AB-178), which outlines the new photovoltaic (PV) requirements.
In his letter to the California State Assembly, Newsom cited that residenices with solar panels “are more resilient to power outages, have increased value, and save the property owner more than $15,000 in energy costs over 30 years.”
The combination of these financial benefits and the environmental advantages of solar power has allowed this new law, commonly known as “California’s Solar Mandate,” to be implemented without much major resistance. Even so, some skeptics believe that wind power and other alternative energy sources may be more cost effective than solar power.
Residential Solar Development Requirements
The California solar mandate enforces that solar panels are required on all single-family residences and multi-family residences up to three stories high. This means that all apartment buildings, no matter how wide, will require rooftop solar panels, so long as it is less than four stories.
How many solar panels are required on residences in California?
Solar panel systems are meant to be installed at a large enough capacity inorder to cover a building’s approximate annual electricity consumption. Naturally, this is challenging to calculate exactly when you are building a brand new property, which no one has ever lived in before. For this reason, most builders estimate a building’s average electricity consumption based on the square footage of the floor plan.
As a general rule of thumb, most builders use an estimate of 2 watts of solar power per square feet. This means that for a 2000 square foot residence, 4,000 watts (or 4 kilowatts) of solar capacity needs to be installed (2,000 * 2 = 4,000). Of course, there are many more factors to consider when looking at larger residences and multi-family units. The number of bedrooms, tenants, and building shape must all be considered as well.
Ulitmately, the exact number of solar panels is going to be The amount of solar needed is based on an Energy Design Ratio (EDR). A home’s schematic design can be tested on state-approved software for all new construction.
Solar Panels on Additional Dwelling Units (ADUs)
In an effort to help pay the mortgage or accommodate extra family members, may California properties have 2 or more structures with people living inside. Most commonly an additional dwelling unit (ADU), also known as a carriage house, granny flat, and more, is added with a seperate entrance atop the garage or elsewhere on property.
Importantly, California’s Title 24 Building Energy Efficiency standards also apply to any ADUs on the property. This means that newly constructed additional residences on a property are also required to have photovoltaic solar panels. Due to their size, a carriage house is only likely to have the minimum amount of solar energy capacity required at about 8 panels for buildings that are less than 1000 square feet.
Commercial Solar Development Requirements
Currently, there are no statewide rooftop solar requirements for commercial buildings or residential buildings with greater than 3 stories. This means that new residential apartment highrises are currently not required to include solar panels in the building process. However, this may change in the near future.
The Colorado Building Industry Association has begun discussing a possible commercial solar mandate for large buildings beginning in 2023. The effort has been criticized by those who believe it will add additional costs and praised by those who see the long-term financial benefits of mandated solar energy.
State Funding for Additional Requirements
Thanks to the Constitution of California, states are required to reimburse school districts and local agencies for certain costs mandated by the state. For this to be initiated, statutory provisions have established the procedures to enact the reimbursement payment. However, this law has been created with no reimbursements currently mandatory for solar expenses.
Alternatives and Add-ons for Required Rooftop Solar
What is important to understand is that the state of California only entacts mandated solar requirements in an effort to reduce monthly costs and increase quality of life for its residents. By adopting emission-free electricity, photovoltaic solar panel systems are one of the best ways to generate clean, renewable energy. With that in mind, there are a few add-ons and alternatives property and business owners can adopt in order to reduce the size or eliminate the purchase of a rooftop solar system.
Adding a Solar Battery for Electricity Storage
For those looking to maximize their energy independence, solar batteries can be added to PV systems in order to store excess electricity for later use. In doing so, property owners can use less overall utility power to maximize their savings on electricity bills.
Plus, in areas prone to natural disasters like wildfires, utility power may be cut entirely to prevent damage to the grid and buildings attached to it. With a solar storage battery, a residence or commercial building can operate “off-grid,” completely independent of utility fed power.
If solar storage is part of a building’s PV system, then the required system size can actually be reduced by 40% or more due to its energy efficiency. This can help property owners cut down on required roof space as well as grid dependency.
Adoption of Onsite Energy Efficiency Improvements
Whereas PV systems are supposed to be designed to cover 100% of a buildings electricity consumption, the required installation capacity can be lowered by adopting other onsite energy efficiency improvements. Building owners can reduce the size of their PV solar panel arrays by adopting thermal solar power, installing certified appliances, using green building materials or adopting other energy efficiency initiatives.
Signing Solar Panel Leases
If upfront costs are the primary barrier to entry in building a residnece structure with solar panels, then property owners can instead opt into a solar panel lease. There are many companies in California that will lease solar panels to property owners so that monthly utility costs can be reduced without having to invest any capital upfront.
Of course, solar panel leases are great for easily getting started with solar energy generation. However, new developments are much more likely to include solar panels as part of the “whole package,” and essentially treat the photovoltaic system as if it were such another part of the building. Over the course of its lifetime, owned solar panel systems will generate more ROI then any solar panel lease.
Properties Exempt from Mandatory Solar Requirements
Of course, with every law, there are some exceptions. The solar requirements enforced by California are not a true “mandate,” in that there are a few types of new property developments that are exempt from the new photovoltaic system requirements.
Rebuilding Efforts After Wildfires, Floods, and Other Natural Disasters
In late 2019, an important exemption was granted under the imposing new state solar requirements in response to wildfires, floods and other natural disasters. It has been decided that properties and community buildings that have been damaged in catastrophes are not required to include solar panels in any efforts to partially or completely rebuild structures. This was implemented in the sense that getting back to normalcy is more important than adopting new practices for those affected by a natural disaster.
Community Solar Project Participants
Additionally, some housing developments may sidestep rooftop solar projects if there is an associated community solar initiative available. What this means is that solar panels do not need to be installed on roofs in areas with little sunlight, too much shade, or other specific setbacks (like over the top HOA’s).
Instead, together the local utility and the California Clean Energy Commission (CEC) can approve a shared community “solar garden,” in which residentas draw their electricity. Here, large arrays of solar panels are installed off-site with members of the new community purchasing their power from the large, collective installation. Every kilowatt hour of electricity purchased from the community solar project is then credited towards the property’s power bill, in the same way it would be if the solar panels had generated the electricity directly on site.
Areas with Low Electricity Rates or Poor Solar Access
Although California is nationally recognized for its sunny reputation, there are still some parts of this massive state that simply aren’t conducive to solar energy. In areas without enough direct sunlight, local board approval can be achieved to build structures without photovoltaic systems. As the state’s compass is still aimed towards renewable electricity, many of these areas can subsequently make an effort to adopt wind, geothermal, or hydroelectricity in place of photovoltaics.
Furthermore, areas with exceptionally low electricity rates may be able to apply for exemption. This applies to temporary structures, remote job sites, or other areas that do not incur normal, daily electricity usage. If a building is erected without any intention to connect it to the utility grid, then solar panels are not required. Although, for off grid buildings, most sustainable, remote living environments utilize some form of solar energy.
Although most correctional facilities are normally above three stories, they are also specifically exempt from Calfironia solar requirements. This means that jails and any other correctional institutions are not required to have solar panels installed whenever new buildings are erected. WIth that being said, the state has made a number of efforts in adding green energy production systems in an effort to reduce operating costs of many correctional facilities.
Past Solar Requirements for California Buildings
Before AB-178 was sworn in, the state of California had already been making green strides towards a future with solar energy. A few other other major oridiances that have been enforced in the Golden State.
- Since Jan 1st, 2014, all new Californian residneces and commercial buildings have been required to have a “solar ready roof.”
- Since Jan 1st, 2017, every residence or commercial building below 10 stories in San Francisco has been required to have PV solar panels or solar water heaters.
- Solar “zones,” most commonly on roofs, must be clearly identified in construction plans. Solar zones are required to take up no less than 15% of the roof area.
Essentially, California is a leading example of how purposeful legislation can lead to rapid renewable energy adoption. With a new generation designing only solar ready roofs, the record-setting mandates in San Francisco and statewide paved the way for AB-178 to be enacted.
How long is the California solar mandate going to be required?
Currently, AB-178’s photovoltaic standards are legally mandated until January 1st, 2023. Although evaluation will be analyzed by energy experts, the residential solar mandate is likely to be renewed as solar capacity increases nationwide. In 2023, the mandate may even be updated with new commercial solar (buildings larger than four stories) requirements.
Does California offer a solar tax credit?
For mandated PV requirements, building owners and business owners are still eligible for the federal solar investment tax credit to lower the overall cost of installing a system. The tax credit is applied to a fixed percentage of the total cost of the solar energy system. In 2020, all properties are eligible for a tax credit towards 26% of the system cost, which drops to 22% in 2021. Beginning on January 1st 2022, a 10% credit is only available on commercial systems.
How are California’s new solar requirements being enforced?
In order to erect a new structure, construction companies must certify the building plans with local community ordinances. At this level, exemptions for the PV mandate can be explored. If a property is found to not be exempt from the requirements, then the local jurisdiction and electricity utility are required to approve the solar energy system along various stages of installation.
Are any properties exempt from California’s solar mandate?
Yes, as we have explored above, there are certain exceptions to California’s solar requirements. New buildings larger than 3 stories are not required to have solar energy systems installed. Additionally, shaded properties, low electricity-use areas, financial barriers, and
Does California’s solar mandate make it more expensive to build A house?
Yes. As solar panels are required on every new structure, this will increase the overall building costs of any residence or commercial building in California. Fortunately, most purposefully built structures that have solar panels as a standard feature occur less associated expenses than putting solar panels on an existing structure. The New York Times has estimated that California’s solar mandate will add $8,000 to $12,000 to the cost to build a residence.
Who finances mandated solar installations in California?
Like any other appliance in a residnece, the building owner will be responsible for financing the solar panels. In most cases, the additional cost to install solar panels will be lumped into the monthly mortgage payments.
For residential instances, this adds an average of $40 per month to the mortgage. However, on that same property, the solar panels will save approximately $80 per month on normal electricity expenses. For larger residences and commercial buildings, the average savings increase exponentially as solar panels save building owners from higher-tiered utility billing rates.
Who maintains a building’s rooftop solar in California?
The owner of the building is responsible for maintaining a rooftop solar system in the state of California. Thankfully, one of the best things about solar energy is that the systems used to create it require very little maintenance.
With that said long dry spells can leave solar panels with soot to be cleaned and both internal and external forces can cause components like inverters and wiring to require replacement. Damages to panels may be covered by manufacturers or craftsmanship warranties. Otherwise, repairs for solar energy systems may be covered by some property insurance policies.
Are batteries required for solar panel installations in California?
No, batteries are not required for solar energy installios in California. However, residneces can reduce their required PV capacity by adding a battery for solar energy storage.
What is a solar ready roof?
After a “solar ready roof” was required for any new construction in California, this let many people owning what a “solar ready roof” actually was. By definition, a solar ready roof
Is a specifically designed structure to easily accommodate solar panels. This means that it should be south facing, have plenty of available space, and contain minimal obstructions. The National Renewable Energy Laboratory has put together this overview for solar ready roof guidelines.