An Overview of California Energy Legislation

An Overview of California Energy Legislation


Change is coming, California. As the battle to mitigate global climate change grows, California is leading the charge towards a sustainable future. You know what that means? A ton of new (and dense) legislation to get us there. In the flurry of legislative numbers and letters, you may find yourself wondering what this all means and why you should care. Fortunately, your energy intern has done an unholy amount of reading to fill you in on the whirlwind of positive change that’s coming your way. These 10 pieces of legislation are already in motion, proving that a more sustainable California is inevitable. Actually, it’s the law.

COP 21

The 2015 United Nations Climate Change Conference – also known as COP 21 – served as a revolutionary new step in combating global climate change and reducing worldwide greenhouse gas emissions. 196 nations negotiated the Paris Agreement. aiming to curb anthropogenic (man-made) greenhouse gas emissions, ultimately achieving net zero emissions by 2050.

While the Paris Agreement holds no enforcement power over partner nations, it stands as the most progressive and collaborative measure ever adopted by the international community to mitigate global climate change.

AB 32

California State Assembly Bill 32 requires that the state lower its greenhouse gas emissions by 40% of 1990 levels by 2020. It further stipulates that statewide efforts will continue beyond 2020 in hopes of further reducing emissions to 80% below 1990 levels by 2050.

California’s oil refineries, electricity power plants, waste management, cement plants and other industries are now under increasingly stringent emissions standards and fines. This will be supported by a cap and trade program. This means companies must purchase emissions “allowances” from the state or other companies, with excess “allowances” to avoid fines for surplus emissions. The money collected from emitters will be used to support investments, and market transitions, to cleaner technologies (i.e. solar, wind, geo-thermal).

“AB 32 will push solar thermal market in the right direction by increasing direct energy savings,” says Johannes Luttenberger, the COO of Austria-based Solid Solar Installation and Design. “Under AB 32, solar energy savings will increase and solar thermal heating and cooling will become more attractive in industrial processes.”


Executive Order B-30-15 establishes the most ambitious greenhouse gas reduction targets in North America. Signed by California Governor, Jerry Brown, in 2015, the order calls for California’s greenhouse gas emissions to reach 40% below 1990 levels by 2030. This is the same benchmark established by the 28 members of the European Union, placing the state’s goals among the most progressive in the world.

AB 2460

California State Assembly Bill 2460 (2007) will significantly reduce the state’s reliance of natural gas consumption. The bill acknowledges solar thermal systems as the most effective clean energy alternative to natural gas. It is directing the state’s attention and resources to expanding solar thermal usage.

The state will accomplish this goal by extending the California Solar Initiative Thermal program funding for 10 years through 2027, providing certainty to the growing solar water heating market. Eligible customer classes identified in the bill include single-family and multifamily residential, commercial, industrial, governmental, nonprofit, and primary, secondary, and postsecondary educational customers.

California will provide financial incentives that target low income housing, making sustainable living attainable to those who would not otherwise be able to afford a solar thermal system. These incentive programs are funded through the use of a surcharge applied to gas customers based upon the amount of natural gas consumed. The surcharge will be in addition to any other charges for natural gas sold or transported for consumption in this state.

SB 555

California State Senate Bill 555 supports existing laws which aim to cut urban per capita water use by 20% by December of 2020. This bill would require each urban retail water supplier to submit a completed and validated water loss audit report for the previous calendar year or previous fiscal year as prescribed by rules adopted by the Department of Water Resources.

Water loss audit reports must be available through Dept. of Water Resources website for comparison with other companies and for public viewing. Moreover, SB 555 would require the department to provide technical assistance to guide urban retail water suppliers’ water loss detection programs.

These reports will allow the state to track incremental progress towards achieving its water usage goals as well as creating more efficient urban water supply systems.

AB 811

California State Assembly Bill 811 was signed into law in 2008. It authorized cities and counties to enter into contractual agreements with citizens to finance and install permanently fixed renewable energy systems to residential, commercial, or industrial properties. This would allow property owners to finance energy efficiency improvements through low-interest loans that would appear as an item on the owner’s property tax bill. AB 811 was passed to support the goals outlined in the Global Warming Solutions Act of 2006 (AB 32).

AB 811 allowed California to address issues of energy efficiency and sustainability at the community level while increasing property values and empowering constituents with the fiscal security of distributed energy. This bill enabled energy financing options like the Property Assessed Clean Energy (PACE) and CaliforniaFIRST programs.

Proposition 39

Proposition 39 was a measure passed by 61% of California voters in 2012. Its primary goal is to close tax loopholes that allow out-of-state businesses to receive tax breaks for removing jobs from their California operations. The measure essentially uses increased taxes to discourage the removal of California jobs for corporations not based in the state. Note that this tax increase does not apply to California residents of California-based businesses.

The additional revenue generated from closing these loopholes – an estimated $1 billion – is used to fund clean energy initiatives in public schools. It will also create new jobs in the clean energy sector.

Eligible local educational agencies (LEAs) — including county offices of education, school districts, charter schools and state special schools—can request funding by submitting an energy expenditure plan application to the California Energy Commission.

Title 24

Title 24, more formally known as The Energy Efficiency Standards for Residential and Nonresidential Buildings, was first passed in 1978 to reduce California’s energy consumption. State building codes outline water and energy efficiency standards that must be met by buildings in the state in order to achieve the emission targets described in AB 32.

“The 2017 Title 24 update is a preparation step towards new residential mandated to be Net Zero by 2020,” says Katy Hamilton, the VP of Architectural Energy at Adroit Energy, Inc. “Architects will have to take renewable technologies into consideration during design in order to pass California’s standards. The earlier this is considered in design, the easier it will be to integrate.”

Under Title 24, 15% of the space on rooftops for small and medium sized structures (10 floors or less) must be prepared to accommodate solar technologies. However, these codes have been periodically updated since 1978 and have, as a result, grown increasingly complex and difficult for developers, contractors, and manufacturers to follow. This drives up the price of construction and installation because the building code is often misinterpreted.

The most recent updates to Title 24 will go into effect on January 1, 2017 with the aim of simplifying the language of California building codes and creating more realistic power distribution standards.

San Francisco City Ordinance No. 160154

The Board of Supervisors for the city of San Francisco unanimously voted in support of a city-wide renewable energy ordinance requiring solar photovoltaics and/or solar hot water systems to be installed on new buildings. This will go into effect at the beginning of 2017.

“Activating underutilized roof space is a smart and efficient way to promote the use of solar energy and improve our environment. We need to continue to pursue aggressive renewable energy policies to ensure a sustainable future for our city and our region,” Supervisor Scott Wiener stated in an April press release.

The passage of this ordinance makes San Francisco the first major city in the United States to pass such progressive energy legislation. First introduced by Supervisor Wiener, the ordinance will help San Francisco move towards meeting 100% of its energy demands through renewable sources.

San Diego 100% Renewable Energy Target

About a week after the historic COP 21 agreement was reached in Paris, San Diego announced its commitment to transition to 100% renewable energy by 2035 – this includes use of wind and solar technologies. While a number of US cities have announced similar goals, San Diego is the largest municipality to make its targets legally binding.

Republican mayor Kevin Faulconer and the Democrat-controlled City Council, announced a bipartisan agreement to make the city-wide clean energy transition by 2035. The agreement further calls for San Diego to reduce carbon emissions by 50% and to replace half of the city’s cars with electric vehicles in that time frame.

“These commitments which mandate clean energy systems are a very positive sign for the clean energy industry,” says Adroit Energy, Inc. VP of Engineering and COO William Chen. “These requirements would help with the integration of renewable energy systems by incorporating it into the original building design process.”

According to the California Sierra Club, this target would reduce the city’s emissions by seven million metric tons of greenhouse gases each year. This would be a significant contribution to California’s broader goal of reducing greenhouse gas emissions by 80% in 2050. The announcement establishes San Diego as a national leader in the battle to curb global climate change and build a more sustainable future.


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