New Program Starts in 2020
This year the California Energy Commission approved a far-reaching requirement for new homes in the state, starting in 2020. All new homes will then have to include solar panels capable of producing between 2 and 3 kilowatts of power. This new regulation supports the state’s goal of providing half of its power from renewable resources by 2030.
How Much Will It Cost?
Costs will be relatively low, as the kilowatt requirement is less than the typical California household installation. Regulators peg the expected average cost at $9500 per home. Factored into a 30-year mortgage, the additional cost per month should be $40. On the plus side, the free photovoltaic electricity produced by the panels should save $80 per month in utility costs. Therefore, the plan is believed to offer homeowners a net discount on their total costs from the first day of occupation.
For some housing developments, builders may also opt to create a solar farm that supplies electricity to each home in the neighborhood. This centralized option may provide the same benefits on utility costs while potentially reducing the upfront costs to the buyer. This flexibility for the builder is no accident, according to Bob Raymer, Technical Director for the California Building Industry Association. “To significantly reduce overall compliance costs and to provide increased design flexibility…was the key to gaining industry support [for] these first-of-a-kind regulations.”
In addition, since solar panels continue to improve in quality and efficiency, meeting the 2 to 3 kilowatt goal may be cheaper by 2020 and will undoubtedly become cheaper in the future. The timing of the regulation is also interesting, as the current federal tax credit for installing a solar array is 30% of the cost, until the end of 2019. In 2020, that credit goes down to 26% and even lower in 2021 to 22%, ending for residential customers in 2022. This new mandate will serve to boost the number of new solar installations in California, even without the federal credit. (It remains to be seen how the federal credit will work for homebuyers in 2020 and 2021.)
If you are a contractor or developer building homes in the Sacramento and Northern California area, Solaron is ready to assist with the most efficient solar panels on the market, manufactured by SunPower. Contact us today for assistance now and into 2020!