Last fall, the California State Assembly passed a suite of bills that seek to reduce greenhouse gas emissions, promote new technologies, and decrease energy use in California’s existing and new building stock. The most prominent of these bills, SB 100, commits California to 100 percent renewable energy by 2045. This article provides a high-level overview of these bills and how they may affect multifamily properties.
SB 100 California Renewables Portfolio Standard Program: Emissions of Greenhouse Gases
- Achieve 100 percent carbon free, renewable electricity by 2045
- 2026: 50 percent of electricity must come from renewable sources
- 2030: 60 percent of electricity must come from renewable sources
- 2045: 100 percent of electricity must be carbon-free
SB 100 directs the California Air Resources Board to develop a framework that achieves 100 percent carbon free electricity by 2045. With SB 100, California is signaling to businesses, property owners, and other industry stakeholders that the state is committed to implementing clean, renewable energy in both the short and long term and can inform energy consumption-related planning decisions for multiple stakeholders.
In order to drive California towards its goal of 100 percent clean electricity by 2045, the state has passed multiple bills that seek to reduce consumption and emissions in specific areas. The following are two crucial bills that support SB 100’s goals.
AB 3232 Zero-emissions Buildings and Sources of Heat Energy
- Reduce greenhouse gas emissions from California’s building stock by 40 percent below 1990 levels by 2030
- January 1, 2021: CEC must complete assessment
- 2030: Achieve reduction in emissions 40 percent below 1990 levels
AB 3232 requires the California Energy Commission (CEC) to assess how to reduce greenhouse gas emissions from California’s building stock by 40 percent below 1990 levels. The CEC must complete this assessment by January 1, 2021.
According to the Natural Resources Defense Council (NRDC), ”over the next two years, the California Energy Commission will engage stakeholders—including utilities, building professionals, equipment manufacturers, and the public—to determine how best to achieve these goals, and will report to the legislature by January 1, 2021.” While stakeholders have yet to determine specifics, actions already underway provide clues to the CEC’s likely plan: provide incentives and update building code and regulations to make it easier for building owners to install equipment that saves energy and reduces emissions. NRDC notes the following examples:
- Senate Bill 1477 provides $50 million in annual incentives through 2023 to jump-start market development for new low-emissions buildings and clean heating technology in the state. (See more details on SB1477 below)
- The updated building energy efficiency standards (or building code) that go into effect in January 2020 will make it much easier to use high-efficiency electric heat pump technology in new buildings.
- The California Public Utilities Commission (CPUC) is considering how to revise outdated regulations that currently make it difficult for investor-owned utilities to provide incentives for clean heating equipment. A decision is expected by the end of this year.
SB 1477 Low-emissions Buildings and Sources of Heat Energy
- Make climate-friendly homes and clean heating technologies accessible to all Californians
SB 1477 authorizes the California Public Utilities Commission to allocate up to $50 million per year to two new programs: Building Initiative for Low-Emissions Development (BUILD) and the Technology and Equipment for Clean Heating (TECH) Initiative. These programs will encourage market-based development and adoption of low-emission, clean technologies for buildings. Note, 30 percent of incentive funds will be earmarked for affordable properties.
BUILD will provide incentives for energy storage, solar thermal, and other technologies to help new buildings reduce greenhouse gas emissions. BUILD will provide more opportunities for properties to secure incentives for energy efficient retrofits.
TECH encourages market development for low-emissions space and water heating technologies by incentivizing distributors and retailers to make equipment available, and it provides customer education and contractor training. TECH should make low-emission technologies more visible and easier to understand for consumers, and it will help prepare contractors and other industry stakeholders to successfully implement these measures at job sites.
Collectively, these bills signal that California remains firmly committed to its clean energy goals. California will achieve these goals through market transformation, training and education, and building code, which it has used to great success since the implementation of Title-24 in 1978.
These bills commit California to providing much needed support to achieve its clean energy goals. This should translate into greater availability of resources, learning and training opportunities, and advanced technologies to help property owners reduce energy use, provide safer and more comfortable homes, and, ultimately, be more profitable.