New California Bills Tackle Solar and Water

CodeWatcher California mandates solar and water efficiency

Will California’s solar and water mandates spread to other states?

In a decision that garnered headlines from California to New York to England, the
California Energy Commission (CEC) voted 5-0 to require solar panels on new homes, condos and apartment buildings 3 stories or less that are permitted after January 1, 2020 (with some exceptions).

While a couple of cities in the state had already passed such a mandate, this new requirement will apply to the entire state. California is the first state to take such a bold step.

The CEC’s directive calls for a minimum system size of “2 to 3 kilowatts, depending
mostly on the size of the home.” However, builders installing batteries would get “compliance credits,” allowing them to further reduce the size of the solar system.

At first glance, this might seem like an incredible cost burden to place on new
home buyers. However, the CEC sees this as a net positive. Some have estimated this will increase the sticker price of new homes by $8,000 to $16,000. However, since most homes are mortgaged, one has to examine the effect on the monthly mortgage payment.

According to the CEC, the new requirement should raise the monthly mortgage payment by $40. That increase will be offset by an estimated $80 monthly savings in utility bills.

C.R. Herro, Meritage’s Vice President of Environmental Affairs, told the OC Register that “the new energy standards add about $25,000 to $30,000 to the construction costs
compared with homes built to the 2006 code, but that increased cost will result in $50,000 to $60,000 in the owner’s reduced operating costs over the 25-year life of the home’s solar system.”

Two important notes about the solar requirement:

1. Not every home will need to comply. Exceptions or alternatives will be allowed
when homes are shaded by trees or buildings or when the home’s roof is too small
to accommodate solar panels.
2. Builders have a couple of design options. They can either have solar panels
installed on the individual home, or build a shared solar-power system serving a
group of homes. In the case of rooftop panels, they can either be owned outright
and rolled into the home price, or made available for lease on a monthly basis.2

On the water front, SB 606 is aimed at urban retail water suppliers, and takes their existing water planning measures and raises the bar. The bill requires an urban retail water supplier to calculate an urban water use objective no later than November 1, 2023, and by November 1 every year thereafter, along with its actual urban water use by those same dates. It also requires an urban water management plan to be updated on or before July 1, in years ending in six and one, incorporating updated and new information from the 5 years preceding the plan update.

Each plan would contain a simple lay description of specified information to provide a general understanding of the agency’s plan. The urban water management plan will need to contain a drought risk assessment that examines water shortage risks for a drought lasting the next five consecutive years and a water shortage contingency plan.

Finally, urban water suppliers will need to conduct an annual water supply and demand assessment and submit an annual water shortage assessment report, with information for anticipated shortage, triggered shortage response actions, compliance and enforcement actions, and communication actions consistent with the supplier’s water shortage contingency plan by June 1 of each year.

If the urban water supplier does not comply with the requirements relating to urban
water management plans, they will be ineligible to receive any water grant or loan. Furthermore, the governing body of a distributor of a public water supply will be required to declare a water shortage emergency condition whenever it finds and determines the above-described circumstances. At that point, the supplier would need to coordinate with any city or county within which it provides water supply services for a possible proclamation of a local emergency.

Another bill of importance, AB 1668 (Indoor and agricultural water use), has two main components: A gallons per capita daily (GPCD) goal for indoor water use over the entire system, and a water budget requirement for agricultural water suppliers.

For the indoor water use, the State Water Resources Control Board, in coordination with
the Department of Water Resources (DWR), is now required to adopt long-term standards for the efficient use of water and performance measures for commercial, industrial, and institutional water use on or before June 30, 2022. The bill requires DWR, in coordination with the Board, to conduct necessary studies and investigations and make recommendations, no later than October 1, 2021, for purposes of these standards and performance measures.

DWR and the Board will also have to conduct necessary studies and investigations and it authorizes DWR and the Board to jointly recommend to the Legislature a standard for indoor residential water use.

Until January 1, 2025, 55 gallons per capita daily (GPCD) is the standard for indoor residential water use. Beginning January 1, 2025, the requirement changes to the greater of 52.5 GPCD or a standard recommended by DWR and the Board as the standard for indoor residential water use. On January 1, 2030, the requirement changes once more to the greater of 50 GPCD or a standard recommended by DWR and the Board. The bill would impose civil liability on the supplier for a violation of an order or regulation issued pursuant to these provisions.

Agricultural water suppliers are already required to prepare and adopt an agricultural
water management plan, but now they also have to include an annual water budget based on the quantification of all inflow and outflow components for the service area of the agricultural water supplier and a drought plan describing the actions of the agricultural water supplier for drought preparedness and management of water supplies and allocations during drought conditions.

Also, the agricultural water suppliers now need to update their agricultural water management plan on or before April 1, 2021, and thereafter on or before April 1 in the years ending in six and one. If they don’t update
their plans, DWR is authorized to contract with certain entities to prepare or complete a plan on behalf of the agricultural water supplier.

One thing needs to be made clear on this legislation. There is false information being
spread on the Internet about residents facing the possibility of a $1,000 fine for exceeding their GPCD. This is completely untrue and those who are spreading that information clearly haven’t read the bill. In addition to a wonderful article from the Sacramento Bee that debunks this ignorant claim, we searched AB 1668 for the word “fine.” We found one occurrence, in the following sentence:

“If a supplier does not provide data necessary for the preparation or
completion of a plan to the department or the contracting entity as
determined by the department in accordance with subparagraph (A),
the department may assess a fine of one thousand dollars ($1,000) per
day, not to exceed twenty-five thousand dollars ($25,000), until data is
made available.”