The Net-Zero Energy Housing Boom Is Starting Here

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By Tsvetana Paraskova

California, which has ambitious targets to cut its carbon footprint and boost renewable energy use, is a U.S. leader in the construction of zero net energy buildings—homes that produce as much renewable energy as they consume each year.

As per new state legislation adopted in December 2018, all new homes in California of up to three stories, with the exception of those in shade or with roofs too thin to hold solar panels, must have solar panels installed, beginning in 2020.

This new requirement could help propel the number of zero net energy buildings in the state starting next year. As of 2017, California had more than 5,000 zero net single-family homes, according to a report from the Net-Zero Energy Coalition. The multi-family net zero homes numbered more than 7,000. Based on the average annual rise in new home construction in California, the number could rise to as much as 100,000 in 2020, CNBC reports.

The new building standard in the state could be the biggest driver of the rise in zero net energy buildings.

While the new building standard is expected to save home owners a lot of energy expenses in the long term during the life cycle of the solar panel system, the new rules will raise the upfront costs for new homes that could put potential home buyers out of the price range for building a new home, some in the building industry have argued.

Yet, everyone sees the potential long-term benefits in saving costs for home owners on the one hand, and boosting residential solar and saving greenhouse gas emissions, on the other hand.

The California Building Standards Commission (CBSC) approved in December the plan of the California Energy Commission adopted in May last year, officially making the state the first in the United States to require this energy efficiency measure.

In adopting its plan, the California Energy Commission (CEC) said that it was aiming to cut energy use in new homes by more than 50 percent and reduce greenhouse gas emissions by an amount equivalent to taking 115,000 fossil fuel-powered cars off the road.

According to a CEC analysis, the cost of the solar system would add US$9,500 to the initial cost of the home, but it would result in savings of US$19,000 over a 30-year mortgage.

“These highly energy efficient and solar-powered homes will save families money on their energy bills from the moment they walk through their front door. Homebuyers will also have a solar plus storage option, allowing their home-grown clean energy to work for them day and night,” said Kelly Knutsen, Director of Technology Advancement for the California Solar & Storage Association (CALSSA).

According to CALSSA, the solar industry currently installs each year solar on roughly 150,000 new and existing homes in California, of which only around 15,000 are new homes. California—which builds on average 80,000 new homes annually—will see a four-fold increase in solar installations when the new rules start in 2020, CALSSA says.

The solar system requirements could boost the construction of net zero buildings, but those buildings will stay connected to the grid because energy storage solutions remain expensive, experts told CNBC.

Regarding upfront costs on a zero energy home, some studies suggest that those costs are lower than people think.

According to a Rocky Mountain Institute report, zero energy (ZE) and zero-energy ready (ZER) homes account for less than 1 percent of the U.S. residential market, “partially due to outdated perceptions of the incremental cost for these offerings.”

The cost increase to build a ZE or ZER home is modest, the authors of the report say, noting that incremental costs are 6.7–8.1 percent for ZE homes and 0.9–2.5 percent for ZER homes. This is “far less than consumers, builders, and policymakers may realize,” the report says.

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