The University of California may be showing us exactly what the future of commercial and residential development will look like. The new UC Davis West Village mixed-use development is the largest zero net energy development in the nation and may pave the way for similar developments.

By using a combination of energy-efficient features and power generation from SunPower (Nasdaq: SPWRA), the development will create all the power it needs on its own.

Energy efficiency plays an important role in the UC Davis West Village development's goal of zero net energy. Design elements like roof overhangs and sunshades over windows are combined with new technology like highly efficient light fixtures, air conditioning, and solar reflective roof materials.

Demand response, similar to the service EnerNOC (Nasdaq: ENOC) provides, has been considered at the development. But zero net energy isn't possible without generating some power.

You may assume that fields of solar panels would dominate a development powered by solar energy. But by using SunPower's highly efficient panels and designing buildings with angles for solar panels, the rooftop space provides most of the energy the community needs.

Rooftop space is becoming increasingly popular for solar panels, and when designed right can be just as efficient as fixed-tilt utility scale solar projects. Not only new but existing buildings are starting to see the virtues of rooftop solar.

Companies are finding that using wasted space on their commercial rooftops is a great way to generate energy for their operations. Toys R Us is installing a 5.4-MW solar installation developed by Constellation Energy (NYSE: CEG), using Energy Conversion Devices (Nasdaq: ENER) panels. Who knows, maybe a zero net energy warehouse or department store will be next as that market continues to develop.

I think we've seen great possibilities of the future of real estate development with this UC Davis West Village project. As energy-efficient design evolves and solar panels become more efficient, I think this will become a blueprint for what is possible.