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AB2143: Changes in Prevailing Wage & California’s Renewables

AB2143: Changes in Prevailing Wage & California’s Renewables

California’s Latest Renewable Prevailing Wage Laws

Starting January 1, 2024, under a new law (AB 2143) put into place by Gov. Gavin Newsom, all commercial Net Energy Metering (NEM) will be designated as public works. Under AB 2143, NEM projects will fall under prevailing wage regulation and it will be required that 20% of work hours be filled by apprentices from certified programs.

AB 2143 will not apply to residential projects generating less than 15kw, single-family homes, or modular homes. It also does not apply to modular home communities or multi-family housing under two stories.

AB 2143 outlines tools for reporting and ways they will implement and uphold its requirements, as well as the goals for the new law.

Reporting Requirements for Contractors and the Public Utilities Commission

For solar companies working on affected commercial applications, contractors will be required to submit payroll records every six months to the Public Utilities Commission to verify their compliance with the new regulations. If contractors fail to comply, they will not receive energy service under NEM contracts.

The California Public Utilities Commission will also have new reporting requirements under AB 2143. They will be required to publish information on the current standing of solar in the community, where it is lacking, and the projected growth of it within disadvantaged communities.

The Future of Solar with AB 2143

Requirements for prevailing wage regulation and including apprenticeship work within NEM projects uphold what we already know about the solar industry. It is known to be a well-paying industry, and as it grows, it attracts talent and continues to expand for competitive wages and job security.

There is no doubt that this controversial bill is going to increase costs for contractors, with increases in wages decreasing their profit margin, as it may change the cost of available systems and the availability in general.

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