Solar Adoption by Mandates

Abstract

Solar mandates are spreading rapidly. We leverage California’s frontrunner experience to examine their economics. First, we parameterize an engineering model to estimate private payoffs from solar adoption in residential new construction. Second, we test for a ``solar gap'' by comparing payoffs with observed adoption. Although estimated payoffs are generally positive, adoption varies widely. Most buildings do not adopt solar despite positive estimated payoffs, which explain little of the variation in adoption decisions. Third, we evaluate San Francisco’s citywide and California’s statewide mandates. Both mandates increased solar adoption considerably.