Experts Caution About SB 32's Effect on Housing

SACRAMENTO–Proposed legislation aimed at dramatically cutting greenhouse gas emissions will drive up the price of homes, price households out of the housing market, dramatically increase the number of Californians living in poverty and result in an annual loss of billions of dollars in California’s gross state product, according to a report released by the former department of finance director and legislative analysts’ office former chief economist. Furthermore, the report indicates that the immediate effect of Senate Bill 32 would be a sharp reduction in new construction activity until contractors and developers could gain expertise to adapt to the new requirements that would require on-site energy production for every unit built.

The report, authored by former department of finance director, Michael Genest, and former legislative analyst chief economist, Brad Williams, now of Capitol Matrix Consulting, and commissioned by the California Building Industry Association, analyzed SB 32 by senator Fran Pavley. The study found that, should the bill become law, the imposition of a zero net energy mandate on all new construction in California would have to be immediately implemented to achieve the goal’s objectives. Zero net energy homes produce at least as much on-site energy as the home consumes.