A Happy Compromise on Solar

Timothy L. Coyle
Consultant specializing in housing issues

Hooray!  State policy-makers finally did the right thing for housing affordability.  California’s energy regulators recently approved a proposal to power several new-home developments in the Sacramento region using offsite solar systems instead of individual rooftop panels, as the law now requires.

In a recent meeting of the California Energy Commission (CEC), the five-member authority decided unanimously to allow “community shared” solar systems for the projects in lieu of enforcing a statutory provision that each new home built in the state – beginning on January 1st of this year – individually contain solar systems sufficient enough to power the home. 

The decision came at the end of a months-long battle between environmentalists, as well as other rooftop-solar enthusiasts, and the Sacramento Municipal Utility District SMUD) which had proposed that the CEC allow developers to use isolated solar “farms” to generate enough power to serve new housing developments.  

Proponents of the SMUD plan argued the utility’s proposal still met the new law’s major intention – efficiently delivering on the state’s climate-change goals – while holding down costs for new homebuyers and renters, especially those with lower incomes.  The SMUD program was supported by most of California’s housing providers and various affordable housing advocates.

Most of the state’s environmental groups lined up to oppose the initiative.  In doing so they (most likely inadvertently) revealed their underlying disdain for affordable housing – something California homebuilders have maintained for decades.  Environmental activist Laurie Litman said, “The concern is that if it’s cheaper for developers to not put solar on people’s homes, then they’re going to opt for that choice” – arguing, in effect, that unless something costs more than most people can afford, “we don’t like it.”

The action of the CEC means the proposal will move forward in the Sacramento area only.  SMUD’s original plan was to build the farm 100 miles away in Fresno – where costs of maintaining the facility are less – and dedicate the power to the new homes in Sacramento.  But, environmentalists, like the Sierra Club, were fiercely opposed to the idea saying, senselessly, it was too big and too far away. 

Yet, not all environmental groups objected to the final SMUD proposition, exempting the utility from the law.  Notably, the Natural Resources Defense Council (NRDC) submitted a letter of support for the offsite solar program, calling it “a step in the right direction.”  NRDC frequently works with California homebuilders on various construction code issues, among other policies.

Other utilities, like the powerful Los Angeles Department of Water and Power (LADWP) and the Pacific Gas and Electric Company (PG&E) – all of which supported the CEC’s action – are soon expected to do the same as SMUD. 

The action of the CEC is seen as a genuine positive as housing producers work to comply with ever-stricter energy and overall environmental regulations.  It embraces the notion that the state must pursue a more systematic means of providing sources of renewable energy without further exacerbating California’s housing affordability woes.  The SMUD proposal does that.

Who knows?  It might lead to energy providers renting the acres and acres of vacant commercial-building rooftops to utilities for expanding their solar programs – a win-win, for the environment and housing affordability.

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