"Under these new standards, buildings will perform better than ever, at the same time they contribute to a reliable grid", said Commissioner Andrew McAllister, who is the Energy Commission's lead on energy efficiency.
For each megawatt hour (MWh) of electricity, a solar system produces, owners will be granted one Solar Renewable Energy Credit (SREC) that they can then sell, creating a decent income stream for the life of the system.
GTM Research published a new analysis late last week which revealed what it expects to be the upside to this new requirement, specifically, the base-case residential solar PV forecast increased by 14% between 2020 to 2023, which works out to be an increase of about 650 MW.
The minimum amount of solar power required by the new standards wouldn't be enough to meet all the needs of most homes. Vivek Sharma, Senior Director, Crisil Infrastructure Advisory, said: "The Central Electricity Authority and the Central Electricity Regulatory Commission will have to come out with norms that can allow the sale of hybridised power generated from existing projects". "ICRA believes that the hybrid projects are likely to be competitive in tariffs w.r.t to individual wind or solar energy projects, given the benefits associated with hybrid projects (mainly in respect of lower capital cost, optimization of transmission infrastructure & higher generation expected)".
"This is a very bold and visionary step that we're taking", said David Hochschild, a member of the Energy Commission. Construction groups, solar manufacturers, and public utilities and other industry groups in the state have expressed support for the move. If the standards had been implemented at the beginning of 2017, given the state's single-family housing starts of around 60,000, new installations would have increased 30% after accounting for solar systems installed on roughly 20% of new homes, per Moody's. Some homes that are shaded by trees or taller buildings, or have roofs that are too small for panels, would be eligible for exceptions. Community-shared solar generation equipment will also be an option.
California is the largest residential solar market in the nation.