California Property Owners Can Future-Proof Assets With Friendly Incentives

As the current federal administration continues to deter larger utility-scale renewable energy development, smaller installations focused on increasing the electrical efficiency of individual buildings and office parks in California and nationwide remain largely unscathed. This creates an opportunity for such developments to continue the progress necessary to provide reliable access to electricity.

These types of installations are crucial because demand for electrical capacity and reliability will only continue to increase as technology advances, temperatures rise and grid infrastructure across the country undergoes necessary upgrades.

Los Angeles-based Puanani Norwood, office managing partner at Bryan Cave Leighton Paisner LLP, told GlobeSt.com that innovative installations, such as building-integrated photovoltaics, could increase because they offer a potential solution that avoids disruption to a building or office park aesthetic that can result from ground-mounted or rooftop solar installations.

Building-integrated solutions also free up rooftop space for tenant equipment or other building amenities (e.g., pools, restaurants, parks and other community use), thereby attracting tenants, she said.

Norwood added that savvy developers, owners and investors should look to future-proofing their assets by leveraging state and local incentives to offset or minimize the upfront costs of these installations. In California, such opportunities are likely to become more accessible as the state continues its commitment to decarbonize its electrical grid by 2045.

Meanwhile, “these types of installations could fail if they don’t have access to incentives to offset the high installation costs of new technologies,” Norwood warned.

“Also, a lack of community education and awareness of these technological advancements – and their long-term benefits – continues to create challenges. While many of these installations don’t require large semiconductors that are typically imported, the need for increased U.S.-based manufacturing becomes crucial to the success and widespread implementation of these options, while also creating jobs.”

Solar and Battery Storage Required

As of 2023, the California Energy Code requires nearly all commercial and some retrofit projects in the state to include solar and battery storage systems.

The Lumen commercial office building in West LA has a solar panel roof system. Moreover, NEXT Energy Technologies installed the first solar façade comprising transparent solar windows that operate without imported semiconductors at its Santa Barbara-Calif, Calif.-based headquarters. Use of façade solar panels leaves the rooftop space free for tenant amenities or rooftop restaurants and bars.

However, the relatively new technology has been rarely used, despite the installation of the Epic office tower in Hollywood in 2019. While uncommon, façade solar technology may need to become more prevalent in the future, given California’s aggressive clean power goals, limited land space and existing commercial buildings that may require costly updates to ensure structural integrity to support solar arrays and battery storage equipment, with the related maintenance equipment.

EV Charging Now a Necessity

California’s high adoption rate for electric vehicles has made charging a necessity for Class A properties with utilities providing incentives, such as LADWP’s Commercial EV Charger Rebate Program, which helps offset the cost of installing electric vehicle charging equipment. Although open enrollment for Level 2 chargers and fast chargers closed on May 9, 2025, enrollment for chargers servicing medium- to heavy-duty EVs remains open. Still, it requires a feasibility study or a complete submittal package.

Southern California Edison also has a charging infrastructure rebate program that helps with upgrades and installations through 2026.

The CA Building Standards Commission published mandatory standards requiring commercial facilities and public buildings to include pre-wiring for EV charger installation in parking spaces and requirements for a certain number of chargers and capable spaces to store them based on the actual number of parking spaces provided.

Healthcare facilities, shopping centers, multi-family housing and mixed-use projects are increasingly partnering with utility and charging providers to meet new building standards. For example, the Lumen building was constructed to provide 104 EV charging stations for tenant use.

Electric Heat Pump Becoming Mainstream

The California Building Decarbonization Coalition advocates for legislation, regulation, state funding and innovative programs by bringing together private and public stakeholders to develop, collaborate on and implement initiatives that advance the state’s climate goals by lowering carbon emissions.

It leads the California Heat Pump Partnership to bring heat pump technology into the mainstream and achieve the state’s commitment to install six million heat pumps by 2030.

Structures can include direct ownership, where the property owner purchases the energy system and captures all financial benefits; while this requires the most upfront capital investment, it provides the highest long-term savings. Another is an operating lease, in which the landlord pays a fixed monthly fee to lease the energy system and receives all the electricity produced, offering cost certainty with little to no upfront investment. Power purchase agreements can be structured like an operating lease, in which a third-party developer owns and operates the energy system, and the landlord agrees to buy the power generated at a fixed, below-utility rate for a long term. This structure avoids upfront capital costs. Typically, excess power generated would be stored in batteries or returned to the utility grid.

Utilities also offer incentive programs to help property owners secure capital to manage upfront installation costs.