What CA Home Builders Need to Know About the New Solar Law

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As of January 1, 2020 building a house in California got more expensive—and earth friendly. That’s because a new law, actually in the works for a few years, took effect requiring all new housing to include a solar panel system. Regulations are well-outlined and builders have had fair warning, but now that the new requirements have been implemented it’s important to make sure all California home builders are in the know.

What is the California Solar Mandate?

California is the first state in the nation to require solar energy systems on new construction. This isn’t too surprising considering eight out of the top 10 cities in the United States with the highest number of solar equipped homes are already in California. However, now the mandate means that every new home needs to have a system that will adequately provide enough power for the anticipated needs of the home.

What Buildings Does it Apply to?

New construction must include a solar photovoltaic (PV) system as an electricity source for all residential homes up to three stories high. This applies to both single family and multi-family housing. However, there are few exceptions. Houses with roofs too small for solar panel installation or those primarily in the shade may be exempt. Also, in lieu of individual solar systems, builders can coordinate a community solar power system as long as it meets the requirements for all the houses it powers and the builder gets approval from both the California Clean Energy Commission (CEC) and the local utility company.

man installing solar panels on a roof

What’s the Cost for the Homeowner?

Cost has always been a major consideration for homeowners considering adding solar panels and it’s arguably most cost-effective to install them as part of the initial build rather than retrofitting later on. Most homes will cost $8,000-$10,000 to equip with solar panels. While that’s a serious chunk of money, the average $40/month increase to a typical 30-year mortgage is easier to swallow. In addition, a house equipped with solar power should see an average savings of around $80 per month, actually providing a $40 net savings.

How to Calculate the System Size

Builders will need to know the size of the system required for each build, and the information is readily available in the new building codes. Head to your local building department to answer any questions not answered in Title 24, which outlines the size for solar systems based on estimated energy use, regional climate, and the size of the home. The mandate requires a minimum size, but builders can increase the size of the system with no maximum.

Builders can use a smaller system if they also install battery storage into the building. Having the capacity to store energy takes up additional space in the home, but reduces the size of the required system by up to 25%. In fact, installing a battery storage system alongside other energy-saving materials can allow a system to be downsized up to 40%.

man calculating on a tablet in front of solar panels

How to Fund the New Systems

Not only is the cost a factor for the homeowner, but it impacts the builder too, who will likely need to pay for the system upfront and recoup the costs in the sale of the home.

Another option is for the builder to simply connect the homeowner with a solar provider. Power purchase agreements are like a lease where homeowners make monthly payments directly to the solar company.

How Solar Installs Can Affect Construction Timelines

Each component of a housing builds should be carefully factored into the overall timeline and adding a solar panel electrical system to the to-do- list is no exception. Builders will need to consider where they will source system parts and get delivery estimates. Workers trained in the proper installation will need to be scheduled once the roof is finished.

Builders may need to add in time to consult with architects in the planning stages to ensure solar-friendly roofs meet the requirements of the new code. It’s also important to know that actually getting service from the provider can take a few weeks up to several months so figure that out before handing the keys to the new owner and finding out the system doesn’t work.