BILL ANALYSIS Ó
SENATE GOVERNANCE & FINANCE COMMITTEE
Senator Lois Wolk, Chair
BILL NO: AB 2188 HEARING: 6/25/14
AUTHOR: Muratsuchi FISCAL: Yes
VERSION: 6/18/14 TAX LEVY: No
CONSULTANT: Ewing
SOLAR ENERGY: PERMITS
Requires cities and counties to adopt an ordinance
streamlining the permit process for small rooftop solar
energy systems.
Background and Existing Law
The Solar Rights Act of 1978 established a homeowner's
right to install a solar energy system by limiting the
ability of a homeowners association or other non-public
entity to prohibit such an installation. The Act also
limited the authority of a local agency to place
unreasonable restrictions on the use of solar energy
systems (AB 3250 Levine, Chapter 1154, 1978).
The Solar Rights Act was modified in 2008 to further
restrict limits on the installation of solar electricity
generation systems and require, in writing, a reason from a
homeowners association if denying permission to install a
solar energy system on a home (AB 2180 Wolk, Chapter 539,
2008). The Legislature also declared solar energy system
installation to be a matter of statewide concern, and made
a local government's grant of permission to install a solar
energy system ministerial rather than discretionary, with
some exceptions (AB 2473 Wolk, Chapter 789, 2004).
The Governor's Million Solar Homes Program established the
goal of installing 3,000 megawatts of solar generation
capacity, establishing a self-sufficient solar industry,
and placing photovoltaic systems on 50% of new homes. The
Act includes a requirement that sellers of production
homes, under specified conditions, offer to home buyers the
option of installing a solar energy system (SB 1 Murray,
Chapter 132, 2006).
Through these initiatives, along with making available
AB 2188 -- 6/18/14 -- Page 2
incentives for solar energy systems, the state has promoted
the expansion of rooftop and related solar electricity
generation.
Some solar industry leaders are concerned that further
expansion of solar energy generation will require increased
cooperation from local agencies, and more uniformity in the
permitting process to streamline and reduce installation
costs.
Proposed Law
Assembly Bill 2188 requires, on or before September 30,
2015, every city and county to adopt an ordinance, in
consultation with fire and utility officials, as specified,
to streamline and expedite the permitting process for
small, residential, rooftop, solar energy systems.
Defines small rooftop solar energy systems as systems that
meet all of the following:
A solar energy system that is no larger than 10
kilowatts alternating current nameplate rating or 30
kilowatts thermal.
A solar energy system that conforms to all
applicable state fire, structural, electrical, and
other building codes as adopted or amended by the
city, county, or city and county and applicable safety
and performance standards established by the National
Electrical Code, the Institute of Electrical and
Electronics Engineers, and accredited testing
laboratories such as Underwriters Laboratories and,
where applicable, rules of the Public Utilities
Commission regarding safety and reliability.
A solar energy system that is installed on a single
or duplex family dwelling.
A solar panel or module array that does not exceed
the maximum legal building height.
AB 2188 -- 6/18/14 -- Page 3
As part of that ordinance, each city and county must
develop a checklist of all requirements that allow rooftop
solar energy systems to be eligible for expedited review.
AB 2188 establishes that all complete applications that
meet the requirement for expedited review, and meet the
requirements of the checklist, must be approved and all
permits and authorizations must be issued.
For incomplete applications, a city or county and a city
and county must issue a written correction notice detailing
all deficiencies and information requirements for expedited
review.
AB 2188 requires each city and county and a city and county
to publish its application checklist and document
requirements on a publicly accessible website if the local
agency maintains a website, and allow for the electronic
signature on all forms, applications and other documents.
The bill requires all cities and counties to accept permit
applications and all associated documents via email, the
internet, or facsimile.
For solar energy systems that qualify for expedited review
under the local ordinance, the limits inspections to one
physical inspection by the city or county, which must be
scheduled within five business days of a request to
inspect. If a city or county determines it cannot provide
inspections within five business days of a request, the
city or county may adopt an ordinance establishing an
alternate time frame or means for scheduling inspections.
AB 2188 prohibits a city or county from conditioning
approval of a small rooftop solar energy system on the
approval of that system by a nonprofit entity created for
the purpose of managing a common interest development.
AB 2188 changes the standard for a local agency to require
a use permit for the installation of a solar energy system,
from a good faith belief, to a finding based on substantial
evidence, that a solar energy system could have a specific,
adverse impact on public health and safety.
AB 2188 -- 6/18/14 -- Page 4
AB 2188 requires solar energy systems for heating water to
be certified by an accredited listing agency, defined as a
standards or testing organization, rather than the Solar
Rating Certification Corporation or other nationally
recognized certification agency specified in current law.
Current law limits the ability of a covenant, deed
restriction or similar instrument to constrain the
installation of a solar energy system on a home, to
reasonable restrictions that do not significantly impact
costs or limit system efficiency. AB 2188 amends the
definition of significant impact from no more than 20
percent of system costs to no more than 10 percent, or
$1,000, whichever is less. AB 2188 also redefines
significant change in efficiency, reducing the current
allowance for loss of efficiency from 20 percent, down to
10 percent.
AB 2188 reduces, from 60 days to 45 days, the amount of
time that an approving agency that is an association, such
as a homeowners association, has to deny, in writing, an
application for a solar energy system. An application that
is not denied in that timeframe is deemed approved.
AB 2188 contains legislative findings and declarations on
the need for the bill, including the value of a modernized
and standardized permitting process for installations of
small-scale solar distributed generation technology to
increase the deployment of solar distributed generation,
expand access to lower income households, provide solar
customers greater installation ease, improve the state's
ability to reach its clean energy goals, and generate much
needed jobs in the state, all while maintaining safety
standards.
State Revenue Impact
No estimate.
Comments
1. Purpose of the bill . California's solar industry has
grown dramatically. That growth has been supported by the
efforts of many local agencies to streamline the permitting
process for small, rooftop solar electricity systems. But
the industry continues to face steep obstacles that must be
AB 2188 -- 6/18/14 -- Page 5
addressed if solar electricity generation is going to help
the state address its growing energy needs. Research
indicates that while the hard costs of solar, namely
materials and components, have come down in price in recent
years, soft costs, including the cost of local agency
permitting and inspection process, are preventing solar
energy systems from being more affordable to many
Californians. The Governor's Office of Planning and
Research has called for streamlining the permit process,
including the development a checklist with expedited review
as a best practice to continue to promote these systems.
AB 2188 directs each city and county to adopt an ordinance
tailored to the unique needs of their communities, to adopt
best practices in the permit application, review and
inspection process, to reduce costs, and promote solar
electricity generation.
2. Home rule . Solar industry officials report that in
recent years cities and counties have become more familiar
with roof top solar electricity generation systems and that
awareness, along with increased uniformity of those
systems, has led to dramatic reductions in permit
processing and inspection times. Over time, more cities
and counties will adopt best practices based on the needs
and experiences of their communities. Those cities and
counties that process hundreds of permits each year, and
which are familiar with solar electricity generations
systems, will realize efficiencies. For them, adopting a
best practice ordinance can make sense. But for those
local agencies that have yet to receive an application for
a rooftop solar generation system, or process very few
permit requests, it does not make sense to require them to
develop a checklist and ordinance when they know little
about these systems and demand for solar permits is low.
The Committee may wish to consider whether the state should
mandate a solar permit ordinance for local agencies who are
fully empowered to adopt best practices on their own.
3. Inspectors and inspections . AB 2188 prohibits cities
and counties from requiring more than one inspection to
review a permitted solar energy project that meets the
requirements for expedited review. Inspections must be
scheduled within five days of a request to inspect. Five
days may not give cities and counties enough time to
schedule all inspections, and it is unclear if all cities
and counties can consolidate structural, engineering and
AB 2188 -- 6/18/14 -- Page 6
fire safety reviews into a single inspection. The
Committee may wish to consider amending the bill to ensure
there is sufficient time and opportunity for cities and
counties to ensure that rooftop solar generation systems
meet health and safety requirements through adequate
inspections.
4. Clarity in order . AB 2188 requires each city and
county to adopt an ordinance and establish a checklist and
states that applications that meet the requirements of the
checklist shall be approved. It is not clear that all
required elements of review can be reflected in a
checklist. In contrast, the ordinance adopted in response
to AB 2188 can and should reflect all applicable
requirements to approve a solar electricity generation
system. The Committee may wish to consider amendments
stating that permits shall be issued upon confirmation that
the application is consistent with all requirements of the
checklist or the ordinance, as determined by the local
agency.
5. Electronic submittal . AB 2188 requires cities and
counties that maintain a website to post their checklist
requirements on their website. The bill also requires each
city and county to accept materials through either email,
the Internet or fax. AB 2188 also requires each local
agency to accept electronic signatures. It is not clear if
the bill requires the acceptance of electronic signatures,
only if local agencies accept documents by email or
Internet. The Committee may wish to consider an amendment
that would clarify that electronic signatures shall be
accepted on electronic documents when local agencies have
the capacity to accept electronic documents.
6. Heating water . AB 2188 references standards for
certifying solar energy systems used for heating water. It
is unclear if the language in the bill recognizes the
availability of independent certification systems for solar
water heaters.
7. Technical amendment . Recent amendments to AB 2188
removed language regarding a follow-up inspection should a
project fail the initial inspection. The language in the
bill suggests that a follow-up inspection is prohibited and
thus a project would need to be re-permitted. The
Committee may wish to consider amendments to clarify that a
AB 2188 -- 6/18/14 -- Page 7
follow-up inspection is allowed, under the terms of the
local agency's ordinance.
8. Related Legislation : AB 2188 is not the only bill that
addresses solar energy systems:
AB 1801 (Campos), Chapter 538, Statutes of 2012,
prohibited a city or county from basing the
calculation of a permit fee for the installation of a
solar energy system on the valuation of the system, or
any other factor not directly associated with the cost
to issue the permit, and required the city or county
to separately identify each fee assessed on the
applicant for the installation of the system on the
invoice provided to the applicant.
SB 1222 (Leno), Chapter 614, Statutes of 2012,
placed a cap on the amount of permit fees charged by a
city or county for both residential and commercial
rooftop solar energy systems, unless a city or county
makes written findings and adopts a resolution or
ordinance providing substantial evidence of the
reasonable cost to issue the permit and why the cost
exceeds the specified caps.
AB 1892 (Smyth), Chapter 40, Statutes of 2008,
provided that a prohibition or restriction on the
installation or use of a solar energy system in any of
the governing documents of a CID is void and
unenforceable.
AB 2180 (Lieu), Chapter 539, Statutes of 2008,
required an HOA in a CID to respond to a request from
a member to install a solar energy system in his/her
separate interest within 60 days.
AB 2473 (Wolk), Chapter 798, Statutes of 2004,
required cities and counties to permit the
installation of solar energy systems if the system
meets specified requirements, and redefined the term
"significantly" in regard to restrictions on solar
electricity generation systems that raise costs or
decrease efficiency.
SB 871. This bill extends the sunset for a solar
tax exemption for new active solar energy systems on
AB 2188 -- 6/18/14 -- Page 8
new construction. The bill extends the exemption
through 2023-24, and extends the sunset through
January 1, 2025. SB 871 is in Enrollment.
Assembly Actions
Assembly Local Government 7-0
Assembly Appropriations 14-0
Assembly Floor 58-8
Support and Opposition (6/19/14)
Support
1st Light Energy; American Solar Power; Arise Solar; ASI
Hastings, Inc.; Aztec lar, Inc.; BMC Solar; Booth
Construction; Burnham Energy; California League of
Conservation Voters; California Solar Energy Industries
Association; Chico Electric; City of Oakland; City of San
Francisco; Clean Power Finance; Clean Solar; Cobalt Power
Systems; Cosmic Solar, Inc.; Delta Solar Electric, Inc.;
Earth Electric; Energy Resolutions; Enphase Energy;
Environment California; FAFCO, Inc.; Freedom Solar;
HelioPower; Home Energy Systems, Inc.; Horizon Solar Power;
Hot Purple Energy; Indus Solar; Insoltech Solar; Luminalt;
Marin Clean Energy; Mayor Gayle McLaughlin, City of
Richmond; Mayor Tom Bates, City of Berkeley; McCalmont
Engineering; New Day Solar; Oakland Metropolitan Chamber of
Commerce; One Block Off the Grid; Promise Energy; Renova
Energy Corp.; RGS Energy; Sierra Club California; Sierra
Pacific Home & Comfort, Inc.; Silicon Valley Leadership
Group; Skyline Innovations; Solarcraft; Solar Energy
Industries Association; Solar Pacific; Solar Roof Dynamics;
Solar Universe, Inc.; Solar Works; SolarCity; SolarCraft;
Solarponics; Solartronics; SolarUniverse; SolarWorks;
Sonoma Clean Power; Spectrum Energy Development, Inc.;
Stellar Solar; Sullivan Solar Power; Sun Integration; Sun
Light & Power; Sun Pacific Solar; Electric, Inc.; Suncrest
Solar; SunEarth, Inc.; Sungevity; Sunintegration; Sunrun;
TerraVerde Renewable Partners; Unique Solar; Vote Solar;
Westcoast Solar Energy; Zep Solar; 2 individuals.
Opposition : American Institute of Architects; California
AB 2188 -- 6/18/14 -- Page 9
Building Industry Association; California Building
Officials; California Fire Chiefs; California Municipal
Utilities Association; Cities of Antioch; Benicia;
Beaumont; Brentwood; Brisbane; Camarillo; Ceres; Cerritos;
Chowchilla; Chula Vista; Concord; Corning; Corona; Del Mar;
Downey; Dublin; El Cerrito; Elk Grove; El Segundo; Eureka;
Fremont; Goleta; Healdsburg; Indian Wells; Lawndale;
Moorpark; Norwalk; Palmdale; Paso Robles; Plymouth; Rancho
Cordova; Redding; Riverbank; Riverside; Rocklin; Roseville;
Sacramento; San Carlos; Santa Rosa; Scotts Valley; Shasta
Lake; Simi Valley; Thousand Oaks; Truckee; Tulare; County
of Orange; Fire Chiefs Association of Santa Barbara County;