July 19, 2018 | By RGR Marketing Blog

A Historic New Ruling for California and the Solar Industry

In an effort to cut energy usage in new homes and to bring the construction industry into play toward hitting the state’s climate goals, The California Energy Commission has ruled that nearly all new homes come equipped with solar panels by the year 2020. While this may at first seem like a massive victory for the solar installation business as a whole—and it definitely appears to be—the impact of the ruling will be complex.

Understanding how the new ruling will likely affect the construction industry and the experience of homeownership in California is key to understanding how the ruling will likely affect the solar installation business. This is especially true, as other factors mitigate the effect of the ruling. These factors include new energy storage capacity, allowing for large-scale solar projects to be incorporated into the existing energy grid.

How the New Ruling Will Likely Affect the Construction Industry and Homeownership in California

The ruling—2019 Building Energy Efficiency Standards—has been touted by the state energy commission as a cost-effective step toward utilizing renewable energy to power California’s homes. But, the ruling contains provisions regarding nonresidential and residential ventilation requirements, nonresidential lighting requirements, and updated thermal envelope standards that prevent or mitigate heat transfer.

The measures are designed to protect California residents from indoor air pollution from both within and outside their homes, while also improving the energy efficiency of newly constructed homes and healthcare facilities. While the solar requirement of the ruling has received the majority of media attention, the ruling is intended to be more comprehensive in nature.

How the New Ruling Will Likely Affect the Solar Installation Business in California

Some have criticized the ruling for not going far enough toward California’s stated goal of converting all homes to zero net energy (ZNE), while others have celebrated the ruling for making homeownership more affordable. Regardless of whether the ruling goes far enough, it has largely been viewed as a windfall for California’s solar installation businesses, especially those that have diversified and offer energy storage installation as well.

The reasons expressed by the state’s energy commission for not mandating zero net energy has to do with California’s already established wealth of solar power and its impact on the state’s energy grid. The commission ruled in favor of requiring home energy storage along with solar, but felt that flooding the grid with additional solar energy in the name of ZNE goals was counterproductive.

As California Goes, so Goes...The Dawning of a New Era?

Some economic experts are predicting that the mandate will ultimately drive the cost of solar installation down. This could signal a tipping point for residential solar across California, driving installations for existing homes as well. And historically, as California goes solar, other states follow suit. We may be on the verge of seeing home solar, home energy storage, and ZNE move more fully into the mainstream.

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