California’s new code isn’t a mandate, it is technology-neutral and performance-based. It doesn’t require homes to be solar-powered and all-electric, but strongly encourages the solutions that have the lower energy costs and carbon emissions, while also discouraging but not preventing continued use of higher-energy and emissions fossil-fueled heating and hot water.
The code does this by providing compliance credits and penalties based on both the energy efficiency and the carbon emissions of the building. If builders choose high-efficiency electric water or space heating instead of gas furnaces and water heaters, they don’t have to make any other energy efficiency upgrades to the rest of the building compared to the current code. If they use gas for both space and water heating, they have to offset the higher energy use and carbon emissions of gas appliances by including other energy efficiency measures such as more insulation or better windows. If they use heat pumps for both space and water heating, they get compliance credits and can avoid some of the more costly energy efficiency measures, while still slashing carbon emissions and occupants’ utility bills.
This incentive approach will give builders a strong financial encouragement to transition off fossil fuels, while leaving them implementation flexibility for adjusting their internal processes such as training their workforce and evolving their marketing practices. NRDC expects that together with complementary financial incentives to encourage early adoption and speed up market ramp-up, this approach will lead to the vast majority of the new residential construction in the state to be mostly- or all-electric starting 2023.
MORE INFO: (from NRDC, 8/11/2021; updated 12/14/2021):