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Tackling Rising Electricity Costs with Solar PPAs in California’s Evolving Energy Landscape

Tackling Rising Electricity Costs with Solar PPAs in California’s Evolving Energy Landscape

2024 Rising Costs, Sustainability, Solar and Energy Policy Shifts in California

In the wake of California’s rapidly escalating electricity costs & changing legislative and utility policies, businesses are increasingly seeking sustainable and cost-effective energy solutions. The state’s new policy changes encompassing federal and state prevailing wage requirements, the CEC’s mandate for solar plus storage in new and retrofit commercial constructions, SCAQMD’s indirect source rule 2305, and the CPUC’s battle to overhaul net metering programs are reshaping the energy landscape for commercial enterprises as the state eyes higher and higher sustainability goals.

2024 has brought a steep increase in electricity costs across California, affecting businesses large and small. This upsurge is a direct consequence of a combination of factors, including infrastructure investments, environmental regulations, and market dynamics. For companies battling these rising costs, a commercial solar Power Purchase Agreement (PPA) emerges as a viable, cost-saving alternative. As many businesses have already taken a step towards sustainability, those who delay not only miss out on opportunity cost but also fall behind their competitors who adapted to California’s shifting energy landscape.

Understanding New Prevailing Wage Requirements

The introduction of prevailing wage requirements for solar projects, outlined in both California’s new legislation and the federal Inflation Reduction Act, marks a significant shift. These requirements mandate fair wages for workers on solar installations, inevitably impacting project costs. However, for businesses utilizing a solar PPA, this can translate into a long-term, stable investment in renewable energy, while supporting ethical labor practices. Learn more about the new prevailing wage requirements for new commercial solar projects here.

CEC Solar Plus Storage Mandate for Commercial Buildings

The California Energy Commission (CEC) has taken a groundbreaking step by requiring solar plus storage systems in all new commercial constructions and certain retrofits. While the minimum requirements are low, the new mandate provides an opportunity for new buildings to consider future energy use and potential solutions before operations begin.

This policy not only aims to boost renewable energy adoption but also ensures energy resilience and efficiency for businesses. The mandate encompasses a wide range of commercial properties and helps position California as a leader in sustainable building practices. Learn more through an explainer video here.

Warehouses Responding to SCAQMD’s Indirect Source Rule 2305

The South Coast Air Quality Management District (SCAQMD) Rule 2305, particularly impacting warehouses and logistics centers in California, emphasizes the reduction of air pollution from indirect sources. This rule necessitates businesses to adopt cleaner energy and transportation methods. Solar PPAs offer an effective solution for these businesses to comply with the new regulations and reduce their carbon footprint to achieve greater sustainability. Learn more about how these warehouse facilities are adapting to these new air quality requirements.

Why Are Businesses Choosing a Commercial Solar PPA?

In this dynamic policy environment like California, a commercial solar PPA stands out as an optimal choice for many businesses. This kind of agreement allows businesses to install solar energy systems with little to no upfront capital expenditure. Instead, they agree to purchase the power generated at a predetermined, often lower rate than the utility. This model not only circumvents the initial investment hurdle but also shields businesses from the volatile electricity market.

In a power purchase agreement, businesses lock in lower energy rates, gaining protection against future rate increases. This financial predictability is crucial in a landscape where electricity costs are on the rise. Additionally, by generating their own clean energy, businesses contribute to California’s sustainability goals and enhance their corporate social responsibility profile.

Navigating California Policy Changes with Expertise

As these new policies come into effect, navigating the complexities of solar project implementation becomes more challenging. Partnering with a seasoned solar PPA and EPC solutions provider like Revel Energy can offer businesses the necessary expertise and support to avoid California’s drastically rising electricity costs. From understanding the nuances of the prevailing wage requirements to ensuring compliance with the CEC’s mandates and SCAQMD’s rules, a knowledgeable partner can streamline the transition to solar energy.

The shifting policy landscape in California presents both challenges and opportunities for businesses. Rapidly rising electricity costs, new wage requirements, and stringent building and environmental regulations are prompting a shift towards renewable energy solutions. A commercial solar PPA emerges as a strategic response, offering financial stability, compliance with new regulations, and a commitment to sustainability. 

As we move forward, harnessing the power of the sun through innovative financing models like solar PPAs will be key in navigating California’s evolving energy ecosystem. Contact our expert team today to learn if your business can benefit from a commercial solar PPA.

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Commercial grade rooftop solar is ideal for: manufacturing, warehousing, logistics, industrial, retail, hospitality buildings and more with over 10,000 sq. ft. rooftops.

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Free standing carport solar generates added solar power for properties with limited rooftop space. Added benefits include shading and protection for employees vehicles.

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Crucial for reducing peak demand charges. Automated to supply electricity when your panels won’t. Energy storage is ideal for businesses that incur significant peak charges.

As the popularity of electric vehicles increase, so does the demand for on-site charging. This sustainable amenity has become a parking lot fixture for competitive employers.



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Client Testimonial: Kelemen Company

Corporate Business Park in Irvine, CA has created significant electricity cost savings through commercial solar installed across the 5-building business park.

Client Testimonial: Tice Gardner & Fujimoto LLP

See how this CPA firm saved on electricity and gained valuable tax credits through commercial solar that they used to keep cash in the businesses.






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