The State of California recently passed a building and construction code mandate that requires all new residential structures built after 2020 to have solar roofs. These could be in the form of water heaters or photovoltaic (PV) units. The mandate has elicited a torrent of responses with commentators praising and criticizing it in equal measure.

While both sides of the divide have valid points, what is important to note is that this is part of a broader push by the state to make all homes in the state energy-efficient by 2030. This mandate is likely another milestone in a long list of past and upcoming legislation that will move the state-building sector in this direction.

Meanwhile, we can look at arguments for and against the legislation to get a clear picture of what lies ahead for the solar industry in the State of California. We will start with arguments.

Property values will appreciate: Right now, energy-efficient properties are rare. Market rules dictate that anything rare has a high value. This argument, if applied to the just-passed mandate, can mean that homes in California may eventually command substantially higher prices, especially from climate-conscious families. They would be willing to pay more for a more sustainable way of living.

Solar companies will grow: Construction companies will turn to solar companies like PCS Energy Solar because of the mandate, something that could boost solar company business.  This could, in turn, stimulate further investment in solar companies, R&D, and other related areas resulting in the overall growth of the industry. Upstream and downstream suppliers also stand to benefit from this boom.

Cost of solar will go down: Right now, the cost of solar is struggling to normalize in a market that is affected by legislative gaps, cheap oil, and other factors. With the mandate, there could come a proliferation of innovations, and resulting competition could eventually push the cost of solar down. This may consequently enable more investment in research and further propel the industry forward. 

There are cheaper ways to reduce carbon emissions: According to critics, the state could have implemented any one of cheaper and more effective ways to reduce emissions. Some of these measures would have included stricter home and vehicle efficiency and emission rules, expansion of the renewable energy mandate, among others.

Housing costs will go up: Critics foresee an increase in housing costs in the state because of the mandate. As the cost of adding solar roofing to new homes will be passed on to the buyer, this could see homes in California cost significantly more than homes in comparable areas in other states. All told, this could add to the current housing crisis bedeviling the state.

The net carbon emission reductions will be zero: According to economists, this measure will have a net-zero effect on emissions due to the relatively low-carbon-footprint that residential properties have. In their opinion, a better approach would have been to go after bigger emission culprits like commercial and industrial buildings.