AB 738 creates a temporary exception to changing photovoltaic (PV) requirements for certain residential rebuilding projects after a declared state emergency. For eligible homeowners, the bill requires that rebuilt homes comply only with the PV rules that were in effect when the damaged or destroyed home was originally constructed, and bars application of any additional or conflicting PV requirements that took effect by the time of repair or replacement.
The measure is narrowly targeted and time‑limited: it applies only to specified disaster‑area rebuilds for owners who meet several conditions (income threshold, footprint limit, same site, and no code‑upgrade insurance) and sunsets on January 1, 2028. It shifts fact‑finding and eligibility determinations to local permitting agencies and therefore creates a state‑mandated local program while aiming to lower near‑term rebuilding costs for qualifying homeowners — with tradeoffs for longer‑term decarbonization and compliance complexity.
At a Glance
What It Does
The bill freezes which photovoltaic requirements apply to qualifying residential rebuilding in gubernatorially declared disaster areas: eligible projects must meet the PV regulations that were in force when the original building was constructed, not newer or conflicting rules. It expressly prohibits imposing additional or conflicting PV requirements at the time of rebuild.
Who It Affects
Affected parties include low‑ and moderate‑income homeowners who lost homes in declared disaster areas, local building and permitting agencies tasked with verifying eligibility and compliance, and businesses that install or sell PV systems (demand may be reduced for qualifying rebuilds).
Why It Matters
The bill prioritizes near‑term affordability and speed of rebuilding for certain homeowners by preventing retroactive application of stricter PV rules, while imposing administrative responsibilities on local governments and potentially delaying PV uptake in disaster‑recovery housing stock.
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What This Bill Actually Does
AB 738 targets a narrow slice of post‑disaster rebuilding: residential construction that is undertaken to repair, restore, or replace a dwelling damaged or destroyed in an area where the Governor has proclaimed a state of emergency. Rather than requiring compliance with whatever photovoltaic rules exist at the time of rebuilding, the bill directs that such projects obey only the photovoltaic requirements that applied when the original dwelling was built.
The statute carves out PV requirements specifically tied to regulations adopted under section 25402 of the Public Resources Code, so it does not rewrite unrelated energy‑efficiency rules.
Eligibility is conditional. The homeowner’s income must be at or below the county median as determined by the Department of Housing and Community Development’s state income limits.
The rebuilt structure cannot exceed the prior square footage and must sit on the same site. Importantly, the owner must not have had code‑upgrade insurance when the damage occurred; the bill treats absence of that insurance as a precondition for the exception.
These conditions narrow the pool of exempted rebuilds to those that are essentially like‑for‑like, low‑income recoveries.Operationally, AB 738 places the burden on local government: permitting authorities must determine that the older photovoltaic requirements apply and that the owner meets the statutory eligibility tests. That creates a practical compliance task for local inspectors and planners — they must verify historical building‑code baselines, income eligibility against HCD limits, property footprint and location, and insurance status.
The bill also specifies a sunset: the statutory carve‑out expires on January 1, 2028, after which the temporary freeze lapses and regular PV rules again govern rebuilds.
The Five Things You Need to Know
The bill limits photovoltaic compliance for qualifying disaster rebuilds to the PV regulations that were in effect when the original dwelling was constructed, and bars applying newer or conflicting PV requirements at time of rebuilding.
It applies only to rebuilds in areas where the Governor has proclaimed a state of emergency under Chapter 7 of the Government Code.
To qualify, the homeowner’s income must be at or below the county median as measured by HCD state income limits, the rebuilt home’s square footage cannot exceed the original, the rebuild must occur on the same site, and the owner must not have had code‑upgrade insurance at the time of loss.
Local permitting agencies must determine whether the older PV requirements and the owner eligibility conditions are met, creating a state‑mandated local program for verification and enforcement.
The entire exemption is temporary: Section 25402.18 is repealed on January 1, 2028.
Section-by-Section Breakdown
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Freeze PV requirements to original construction regulations
This subsection establishes the core rule: for eligible residential repairs, restorations, or replacements in gubernatorially declared disaster areas, the applicable photovoltaic requirements are the regulations under Public Resources Code section 25402(a) and (b) that existed when the original building was constructed. It also bars imposing any additional or conflicting photovoltaic requirements that are in effect at the time of the rebuild. Practically, this creates a temporal cutoff — compliance is measured against the historical regulatory baseline rather than the current code.
Detailed eligibility conditions
Subsection (b) lists four discrete eligibility tests: (1) the owner’s income must be at or below the county median per HCD state income limits; (2) the rebuilt square footage cannot exceed the pre‑loss footprint; (3) the project must be on the same site as the damaged building; and (4) the owner must not have had code‑upgrade insurance when the loss occurred. Together these conditions limit the exemption to small, like‑for‑like rebuilds for lower‑income owners who did not carry additional insurance covering code compliance costs.
Sunset of the carve‑out
Subsection (c) places a firm expiration on the statute: the section remains in effect only until January 1, 2028, and is repealed on that date. The temporary nature matters for both recovery planning and for local agencies’ administrative design: the exception is intended as a near‑term relief measure rather than a permanent change to California’s building‑energy trajectory.
Local mandate declaration and funding posture
Section 2 declares that no state reimbursement is required under Article XIII B, Section 6 because local agencies have authority to levy fees or assessments to cover the costs of the mandated program. Functionally, the bill recognizes it imposes duties on local permitting bodies to verify eligibility and compliance but does not provide state funding for that work, leaving local governments to absorb or fund the administrative burden themselves.
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Explore Energy in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Low‑ and moderate‑income homeowners who lost their homes in declared disasters — they avoid the potentially higher upfront cost and construction delays of installing photovoltaic systems required by newer regulations, making rebuilds more affordable and faster.
- Owners without code‑upgrade insurance — because the carve‑out specifically excludes those who had such insurance, these homeowners get relief from post‑loss retrofit obligations that insurance might otherwise have covered.
- Some builders and general contractors focused on quick, like‑for‑like rebuilds — projects that would otherwise require additional PV work can close out faster and avoid coordination with solar subcontractors.
Who Bears the Cost
- Local permitting and building departments — they must verify historical code baselines, income eligibility, insurance status, and footprint comparisons without state reimbursement, increasing administrative workload and potential need for new procedures.
- PV manufacturers and installation contractors — qualifying rebuilds will reduce near‑term demand for rooftop solar on these projects, shifting commercial opportunity away from recovery work.
- State climate and energy goals — postponing PV installation on qualifying rebuilds delays emissions reductions and distributed‑generation capacity, a cumulative cost to state decarbonization targets.
- Future homeowners and occupants of rebuilt homes — they may miss out on lower energy bills and resilience benefits that rooftop PV would otherwise provide if newer PV requirements had been applied.
Key Issues
The Core Tension
The central dilemma is whether to prioritize immediate affordability and speed of rebuilding for certain low‑income disaster victims by freezing evolving PV requirements, or to prioritize the state’s broader climate, resilience, and energy goals that favor up‑to‑date solar installation on replaced housing — a choice that eases short‑term recovery costs but delays the benefits of clean energy and imposes verification burdens on local agencies.
AB 738 trades short‑term affordability for potential long‑term costs and administrative complexity. Verifying which PV regulations applied when a home was originally constructed is not always straightforward: codes change incrementally, building records are sometimes incomplete, and local staff will need clear guidance to equitably apply the statute.
The income test ties qualification to HCD’s state income limits mapped to county medians, but the bill does not specify documentation standards or appeal processes, inviting inconsistent local practice and potential disputes.
The exclusion of owners who carried code‑upgrade insurance creates an administrative hinge: local agencies must determine insurance coverage at time of loss, and disputes could arise between owners, insurers, and municipalities. The bill’s preclusion of “additional or conflicting” PV requirements raises preemption and scope questions — for example, how the statute interacts with local ordinances that require PV or with other state programs that incentivize solar during recovery.
Finally, the sunset creates a short policy window; that temporary nature reduces long‑term certainty for developers and installers and could incentivize timing games in repair workflows around the repeal date.
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