Taxpayers lose again with new solar panel mandate

The California Energy Commission has announced new regulations to require rooftop solar panels on all new homes constructed in California beginning in 2020. This forced mandate represents an extraordinary regulatory overreach.

However, don’t expect too much political push-back against these new rules. Why? Because the “winners” who support the regulations have a lot more political juice than the “losers.”

Tops on the list of winners is, of course, the solar industry. When your business is the manufacturing and installation of solar panels, and you can get government to mandate the purchase of your product, you have a guaranteed customer base as well as a guaranteed revenue stream.  For solar companies, spending a few million dollars on political influence results in a great (return on investment).

A less direct benefit behind the solar mandate is conferred on the building industry generally. Although the mandatory inclusion of solar panels will increase the cost of their “product,” i.e. homes, this is a cost developers will just pass along to consumers. Because it’s a government mandate, no developer will be put at a competitive disadvantage.

Add local government to the list of winners. The added cost for solar installations means the purchase price of the homes — upon which the Proposition 13 base-year value is established — will be higher. This translates into a big boost in property tax revenues.

Also a winner is the environmental community, which believes that climate change is a problem that transcends all other human concerns. These are the same interests pushing the policy that internal combustion engines should be banned.

While environmental activists may be a winner with these regulations, it is far from certain that the environment itself will be. Policy leaders continue to disregard the damage to the environment by the mindless pursuit of policies thought to be enviro-friendly. For example, wind turbines provide renewable energy, but at the cost of significant harm to bird populations. Likewise, California’s infamous high speed rail project was sold as part of the state’s climate change response. But the construction of the project is inflicting serious environmental damage in the Central Valley, and even the state’s Legislative Analyst acknowledges that the HSR project will be a net producer of greenhouse gas emissions for the foreseeable future.

Have the advocates of mandatory solar panels actually performed a credible environmental assessment of what the manufacturing process for those panels does to the environment? Most solar panels are built in China, a nation that continues to build coal-fired electricity plants to power its industrial base.

The winners listed above are powerful interest groups that are very well funded and adept at applying political pressure to the California Legislature as well as regulatory agencies.

But future homebuyers and taxpayers are not nearly so influential. That’s why they are the real losers.  Home prices in California are sky-high and our political leaders mouth platitudes about the “housing crisis.” So what’s their answer?  Adding $10,000 to $30,000 to the cost of all new homes in California whether homebuyers want solar panels or not.

The other loser is the principle of free enterprise.  If the majority of homeowners have not purchased solar panels, it is because they have judged that the currently available technology does not offer benefits equal to its cost. A government mandate is an attempt to override that basic reality, at the expense of Californians who are already struggling to afford a home.

These new mandatory regulations are not in the public interest and will only add to the crisis of housing affordability in California.  Perhaps we should add a few more winners to the list: Texas, Arizona, Nevada, Florida and other states where California’s best and brightest young people will be moving to buy their first home.

Jon Coupal is president of the Howard Jarvis Taxpayers Association. This column appeared in the Orange County Register.