Impacts of Senate Bill 32 on California’s Residential Construction and Rental Housing Markets

Interaction between SB 32 and CEQA would likely, at a minimum, result in the immediate imposition of a Zero Net Energy (ZNE) standard on new construction in California. The initial effect would be a sharp  reduction in new construction activity, which would persist until developers and contractors acquired a sufficient level of expertise and capacity to satisfy the stringent new ZNE requirements. Such a slowdown would have ripple effects throughout the entire economy, potentially reducing gross state product by $18 billion, and employment by 285,000 jobs.