"With everything happening in the country right now and President Trump's obsession with coal and the continuing strength of the oil industry, California needs to be aggressive in moving towards a clean energy future, and this is one step in that direction".
Demand for solar equipment in California could rise by 10 percent to 15 percent because of the new standards, the Energy Commission forecast in a study earlier this year.
Utilities that objected to the new rate-design "could contend that the introduction of mandated distributed solar sufficiently alters the policy landscape to warrant further review of the compensation levels paid to excess generation", ClearView said in their report, published ahead of the energy commission's decision.
In the long-term, building more homes - soon with solar panels - could drive down living costs in the Golden State.
It is the first such mandate nationwide and the state's latest step to curb greenhouse gas emissions.
The California Energy Commission on Wednesday approved a requirement for solar panels on new homes starting in 2020.
Getty ImagesLuminalt solar installers Pam Quan (L) and Walter Morales (R) install solar panels on the roof of a home on May 9, 2018 in San Francisco, California.
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But Republican legislative leaders argue Californians can not afford to pay any more for housing in what is already an extremely expensive market.
The California Building Industry Association supports the solar panel requirement after years of working with the energy commission to refine it, said Robert Raymer, the association's technical director. "We certainly would like to see local jurisdictions reduce costs elsewhere".
At the same time, the commission said they will save $80 on heating, cooling and lighting costs per month.
As expected, the California Energy Commission (CEC) passed a first-in-the nation rule Wednesday, mandating that all new homes constructed in the state will be equipped with solar panels.
In addition, new ventilation requirements will apply to new homes and healthcare facilities.