Santa Barbara Joins Cities in California Banning Natural Gas:
Last month on July 20th, 2021, the City Council in Santa Barbara voted to ban natural gas in newly constructed buildings. Going all-electric sounds like a good thing, right? Except, workers in the construction industry worry how this will affect them. After all, they cannot understand the extent of the impact this may have on a business’s current operations. Nonetheless, protecting the environment from greenhouse gases is for the greater good and now we all must adjust. Droughts, wildfires, and natural disasters are increasing threats in California. Natural gas in commercial and residential buildings attributes to about 40% of Santa Barbara’s emissions and 25% statewide. Santa Barbara joins nearly fifty cities in California that have gone electric. These kinds of changes are sure to continue as California reaches towards Zero-Net emissions by 2035. All we can do is stay updated so we can acclimate.
What is the Economic Impact? Resolving Contractors’ Myths About Electrification:
If business as usual will be affected for you, try not to panic. In fact, fully electrified buildings can be more affordable to build new ones. Nobody is requiring gas to be banned in existing homes. Rather, builders can bypass the additional costs of installing natural gas lines and meters. As for energy itself, increased energy efficiency neutralizes electricity costs. Most new homes today are built with electric heating/cooling and appliances already. Electric heat pumps, stoves, ovens, and water heaters are more efficient than their natural gas counterparts. Comparatively, this equipment isn’t much more costly. An electric heat pump is often cheaper to install than a gas furnace! Don’t forget simple solutions such as fireplaces and geothermal home designs. Luckily, builders can take advantage of the temperate weather in Santa Barbara. Ultimately, natural gas has become obsolete.
Also, there are options to provide newly constructed homes with energy. Take solar panels, for example. Since January 1st, 2020, most new homes in California are required to have solar panels installed, anyways. Builders must design solar space based on square footage and climate. Newsom stated that communities with solar panels “are more resilient to power outages, have increased value, and save the property owner more than $15,000 in energy costs over 30 years.” Even if efficient equipment is more expensive than their gas counterparts, builders will also be able to sell these efficient homes at a higher value. Plus, new homeowners’ savings outweigh the initial costs. Alternatively, building developers can design community solar projects, as opposed to individual solar panel systems. Although, they would need approval from both the California Clean Energy Commission (CEC) and the local utility company.
Programs Supporting Natural Gas Ban:
If you are still worried, be aware that local and state governments have plans to help subsidize these changes. There are many programs offered to help businesses adjust. For instance, the Department of Planning and Development for the City of Santa Barbara offers a smart build program. They offer free advice from local professionals in the construction industry, as well as incentives. See a complete list of county-specific Property Tax Programs.
On the other hand, the California Public Utilities Commission is launching programs offering millions to support electrification. See the table provided below by CPUC for some of their various options.
Program Technology Type Sector. Budget Description Implementation Status
Building Initiative for Low emissions Development (BUILD) Program
This program will provide incentives to builders to construct all-electric homes. Program funding is pending CPUC adoption.
D.20-03-027 adopted a rules program budget of $80 million. Energy Division and CEC staff are developing a program implementation plan.
Technology and Equipment for Clean Heating (TECH) Initiative
HPWH HP HVAC
This program will provide incentives to HP technology to encourage sales and adoption. Funding is pending CPUC adoption.
D.20-03-027 adopted rules and a program budget of $120 million. Energy Division will issue a program implementer RFP soon.
Self-Generation Incentive Program (SGIP)
Residential & Commercial
This program will provide incentives for HPWHs, and eligibility requirements of (grid-enabled or not) are forthcoming.
The CPUC hosted a Part 1 workshopon3/19/2020. A Part 2 workshop is scheduled for 5/7/2020. Slides are available athttps://www.cpuc.ca.gov/sgip/
SCE’s ESABuilding Electrification Pilot
(2021 – 2026)
This program focuses on electrifying existing ESAP eligible buildings is pending CPUC approval.
A.19-11-004. A Proposed Decision is scheduled for issuance in Winter 2020.
SCE’s ESABuilding Electrification New Construction Pilot
This program focuses on encouraging the electrification of new low-income buildings. Funding is pending CPUC approval.
A.19-11-004. A Proposed Decision is scheduled for issuance in Winter 2020.
MCE’s Low- Income Tenant and Families (LIFT) 2.0 Program
HPWHs HP HVAC
This whole building multifamily program would focus on energy efficiency and fuel substitution measures installation in qualifying low-income properties.
A.19-11-007. A Proposed Decision is scheduled for issuance in Winter 2020.
SCE Smart Water Heater Program
Residential & Commercial (Small)
This proposed program will cover all costs for the installation of grid-enabled controls on HPWHs to enable energy storage.
Pending Commission approval. Program planning will commence in 2022.
Total CPUC Potential Program Incentive Funding through 2024 – $435 Million
Incentives (Rebates and Credits):
There are many government incentives, offered on both a state and federal level. That’s because the government recognizes the value proposition of investing in EE. Even some utility companies now support the transition to efficiency. You can learn more about these incentives on our page on Building Energy Efficiency Incentives in California. Bottom line is, don’t be too worried unless you’re a natural gas company. They push the narrative that banning natural gas will be burdensome on the economy and consumers. We must question these assumptions by looking at the larger picture. As a whole, California is making investments toward a smarter more affordable future.
Exemptions to Natural Gas Ban:
The natural gas ban for new construction takes effect on January 1st, 2022. Meaning, it applies to any permits pulled from this date onwards. “New construction” includes alterations to existing structures that require more than 75% teardown. However, there are exemptions at this stage. The natural gas ban in new construction does not apply when there is no electricity hookup available at the location. Some commercial instances are exempt such as restaurants, clean rooms, and labs. Lastly, attached granny flats are exempt.
BarrierEnergy is Here to Help:
BarrierEnergy stays on top of code changes to help you prepare as an owner, builder, architect, or engineer. We are a Santa Barbara local business in the Energy Rating industry. Firstly, we have over a decade of experience to offer consultation. On top of that, we provide certifications for energy efficiency compliance that qualify builders for tax stimulus. Did you know that projects registered with CHEERS are automatically evaluated for energy savings eligibility? We are highly familiar with using the CHEERS (California Home Energy Efficiency Rating Services) database.
Contact us if you are interested in receiving available tax credits. We hope you enjoyed this post and subscribed to our newsletter! Continue reading on our page on Santa Barbara’s Community Choice Program.