History of solar policy in California
California has taken significant steps to grow in-state solar: from reaching nearly 23 gigawatts of solar capacity across almost 900,000 solar installations to receiving in-state solar investments of $42 billion through 2018, California leads U.S. states in many solar categories. The state’s commitment to solar in the US is acutely apparent in SEIA’s Top 10 Solar States list: notably, not even the next eight ranked states combined had installed as much solar energy capacity as California in 2018. The history of solar energy in the Golden State spans back to the industry’s earliest roots and is a story of steady progress.
California first began promoting solar energy in 1976, when the state passed tax legislation to provide financial incentives for investment in the technology. Building upon this initial commitment solar, the state quickly passed the Solar Rights Act (CA Civil Code 714) in 1978, which bars restrictions by homeowners associations (HOAs) on the installation of solar energy systems. The state’s commitment to the solar industry fostered an environment of growth that ultimately led to ARCO Solar’s 1980 completion of a 1 megawatt (MW) photovoltaic facility in Camarillo, an impressive capacity for solar at that time.
The state’s booming solar industry truly began to take form with the 1996 passage of the Electric Utility Industry Restructuring Act (Assembly Bill 1890). This progressive energy law made California the first state to deregulate its utility companies, meaning, among other things, that customers could now choose their electric generation supplier. Equally important, California also adopted net metering policies in 1996, allowing excess solar energy to be fed back into the grid, further incentivizing consumers to pursue solar. These state-led initiatives formed the bedrock of California’s solar energy industry.
More recently, an important catalyst for growth in California’s solar industry is the enacting of the California Solar Initiative (CSI) in 2006. The Governor Schwarzenegger-supported legislation designed and provided upfront solar installation rebates to residential and commercial property owners through the state’s three largest investor-owned-utilities – Pacific Gas and Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E). The 2-plus billion dollar program surpassed its intended goal to reach 1,940 MW of new solar generation capacity by 2016, two years ahead of schedule, creating a sustainable market without leaving behind any burdensome legacy costs.
The future for solar energy in California looks as bright as ever. Following the sunsetting of the CSI, California’s state government has pushed even further forward on solar. In 2015, Governor Brown signed into law the Clean Energy and Pollution Reduction Act (Senate Bill 350), which mandates a Renewable Portfolio Standard (RPS) of 33 percent by 2020 and 50 percent by 2030. In 2018, Governor Brown and the state legislature took renewable energy policy two steps further by first requiring the electric sector to decarbonize by 2050 and, second, by requiring the entire state economy to decarbonize by the same year.
Perhaps the most innovative piece of solar legislation from California also came in 2018 as the California Energy Commission (CEC) passed requirements on the 2019 Building Energy Efficiency Standards mandating that all new homes must have solar panels beginning 2020. These policies, both old and new, all but guarantee a successful future for solar in California.