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Solar Mandates: As Goes California, So Goes the Building Sector?

solar panelsAs California goes, according to the old adage, but does it apply to solar energy mandates for new buildings?

Last month San Francisco and Santa Monica approved ordinances requiring rooftop solar systems for new construction. San Francisco’s law, which applies to all new commercial and residential buildings with 10 floors or less, takes effect Jan. 1, 2017. Santa Monica’s requires all new construction to install solar electric photovoltaic systems beginning at the end of this month.

These two cities join three other California municipalities that have solar mandates. Culver City began to require solar on some commercial in 2008; the cities of Lancaster and Sebastopol became the first two to require solar on all new construction in 2013.

New York is also considering mandatory solar installations on some of its municipal buildings.

As the cost of solar continues to decrease, installation is growing, from 1,200 megawatts in 2008 to 27,000 megawatts now, according to the US Department of Energy. The cost-benefit ratio is strong: the city of Santa Monica sites case studies that show solar requirements increase upfront commercial construction costs by .75 percent while reducing long-term electricity costs by 11 percent on average. For multi-family homes, the numbers are .5 percent and 24 percent; for single-family homes they are 2.8 percent and 65 percent, respectively.

“Solar panels actually have a direct return on investment to the owner,” US Green Building Council Northern California director Brenden McEneaney told Environmental Leader. “System costs have dropped dramatically in recent years and mandates like these could accelerate that trend. In fact, major homebuilders like Lennar are including solar panels on spec home communities as part of the package.”

When asked about the implications for the building sector, Lux Research analyst Tyler Ogden told Environmental Leader the California ordinances will expand the group of contractors associated with new construction.

“Alongside plumbers, masons, and electricians, solar developers will now have a common presence on constructions sites,” Ogden said. “The mandates will also have an added effect on how buildings are designed around site-dependent conditions.

Ogden predicts solar mandates will become more prevalent in mature solar markets, “particularly in areas with robust electrical grid infrastructure. In the United States, Massachusetts is one possible market to look to where mandates may be adopted. If the adoption of rooftop solar mandates continues to grow, the policy will have an effect in accelerating the maturation of the solar-plus-storage market that is just developing.”

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