What is Title 24?

Title 24 is a set of building energy efficiency standards adopted by the California Energy Commission (CEC). Title 24 is updated every three years to reflect new technologies and energy efficiency trends. These requirements include HVAC systems, lighting, energy efficiency measures, building envelope, and water heating.

What are the new solar and energy storage requirements for multi-family housing? 

The latest Title 24 regulations are the following:   

• Low-rise multifamily buildings must have solar zones covering at least 15% of the total roof area, excluding skylights. These solar zones can be situated on the roof, building overhangs, or overhangs of nearby structures within a 250-foot radius. This requirement applies to structures with mixed occupancy as well, ensuring comprehensive coverage.
• For low-rise multifamily buildings with interior common areas, occupant sensors must control up to 20% of the floor area, optimizing energy usage in these shared spaces.
• The updated lighting requirements entail several key provisions. Permanent labels indicating maximum rate wattage must be prominently displayed. Each room should have independent manual controls for personalized lighting adjustments. Moreover, multi-level lighting control options and improved shutoff controls, including occupant sensors, automatic time switches, and similar devices, are mandated.
• Multi-family buildings are now required to incorporate on-site renewable energy systems. This necessitates developers to offset approximately 50-60% of both the building and tenant’s total energy consumption, promoting sustainable practices and reducing reliance on non-renewable sources.
• A battery is now required alongside solar PV systems, with its size determined by the size of the solar system.

By adhering to these updated guidelines, low-rise multifamily buildings can enhance their energy efficiency, embrace renewable energy, and contribute to a greener and more sustainable future.

What are the new solar and energy storage requirements for industrial and commercial?

California’s Title 24 has implemented new provisions impacting industrial and commercial projects permitted since Jan. 1, 2023. SolarTech can help navigate these regulations and showcase the benefits of solar and energy storage on your property.

Key provisions include: 

• The mandate for photovoltaic (PV) systems and energy storage
• PV systems must meet approximately 60% of buildings’ electricity loads based on factors such as conditioned floor area, climate zone, and building type.
• Electric Vehicle (EV) charging requirements, including EV-capable spaces and chargers. Larger parking lots must have EV chargers installed, with the percentage varying based on size.
• Battery storage is now required alongside solar PV systems for all new constructions, with the size of the battery’s storage system determined by the size of the solar system.

How to comply with the new Title 24 requirements

There are several ways to comply with the new Title 24 requirements. One option is to work with SolarTech who is familiar with the requirements and install the required amount accordingly. Another option is to monetize energy as the Landlord, described below.

How to generate revenue with solar

These requirements present opportunities for monetizing the energy transition. Industrial and multi-family owners can benefit by offering discounted power to tenants, effectively increasing net operating income and creating an added recurring revenue stream. By installing solar to offset tenant usage, the landlord becomes the energy producer for the property.

Through tenant billing and Virtual Net Metering (VNEM), owners can allocate billing credits based on individual tenant consumption, making it financially advantageous for both single-tenant and multi-tenant scenarios.

By embracing these requirements and exploring innovative solutions, building owners and developers can not only comply with regulations but also unlock financial benefits and contribute to a sustainable future.

SolarTech provides turnkey solutions in solar, energy storage, and EV charging stations. From compliance with Title 24 to providing tailor-made financing options, our experts partner with owners on all their renewable energy needs. Get in contact with one of our experts today. We’ll make sure you project is Title 24 compliant.

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One of the biggest drivers of commercial solar adoption has been the availability of tax incentives for commercial properties. These incentives, which are offered at both the federal and state levels, can help offset the upfront costs of installing solar panels and make the investment more attractive to businesses.

Federal Commercial Solar Tax Credit

At the federal level, the primary tax incentive for commercial solar is the Investment Tax Credit (ITC). This credit allows businesses to deduct 30% of the total cost of a solar system from their federal taxes. The ITC is in place for the next 10 years through the Inflation Reduction Act passed in 2022.

The ITC can be claimed by any business that installs solar panels on a property it owns or leases, and it can be combined with other incentives to further reduce costs. Non-profits and businesses with no use for tax incentives can sell the Tax Credit to a 3rd party conveniently. Additionally, there is no cap on the amount of credit a business can claim.

You can learn more about how to claim the ITC and see if you are eligible here.

Federal and State MACRS

Besides the federal ITC, a solar investment can be tax depreciated using the Modified Accelerated Cost Recovery System (MACRS).

• 80% can be depreciated in year 1 of the system being installed.
• About 23% of the gross investment can be depreciated over 5 years

Under the State (CA) MACRS, businesses may recover investments in solar over the first 5 years once a solar installation occurs.

Overall, a gross investment in a commercial solar system can be deducted by 60-70% in tax incentives. This reduces the payback period immensely and boosts ROI for the lifetime of a system.

The availability of tax incentives has been a major factor in the growth of commercial solar. As businesses look for ways to save money on energy costs or generate a new source of income for property owners, solar offers a compelling solution – and the tax incentives make it even more appealing. If you’re considering a commercial solar installation, be sure to explore all of the available tax incentives to maximize your savings.

Estimate Your MultiFamily Solar Revenue Potential

Make the best of these limited-time incentives! Calculate now much you can be generating by adopting solar for your properties.

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Resources:

1. Energy.gov – Federal Solar Tax Credit Resources
2. What is the Modified Accelerated Cost Recovery System? (MACRS)