Solar Energy rate Plan NEM3: What does it mean?

As of April 15, 2023, all new applications for solar energy will fall in to the NEM3 solar energy utility rate plan. Solar users under NEM3 will get compensated for about $0.08 / kWh for excess energy sent to the grid, an adjusted lower amount than under NEM2. The payback period for a solar investment under NEM 3 is about 10 years.

To maximize homeowner savings, we recommend that anyone who is considering installing a solar electric system, also install battery storage. With battery storage, a system owner can store excess energy to their batteries, and draw from the batteries when the solar stops working and utility grid rates are at peak. Instead of sending excess energy to the grid for $0.08/kWh, and buying energy at peak rates of $0.47/kWh or more, a homeowner generates, stores, and uses their own energy, maximizing savings.

If I already have solar (NEM1 or NEM2), will the new rules (NEM3) affect me?

The CPUC’s new rules will not affect NEM1 and NEM2 solar users until your lock-in period expires, unless you add more panels (more on that in the next section).

The NEM1 and NEM2 lock-in period, also known as grandfathering, is for 20 years after the utility turned on your solar system. Here’s two examples:

  • Your solar system was turned on in 2019. You will be switched to the new rules (NEM3) in 2039.
  • Your solar system turned on in 2003. You will be switched to NEM3 in 2023.

What if I already have solar and want to add more panels?

After NEM3 begins, existing solar users who increase their system size by 10% or 1kW, whichever is more, will be forced onto NEM3. You may want to consider adding panels before NEM3 goes into effect in mid-April.

If you want to add panels before NEM3 takes effect, your solar company must submit a correct and complete interconnection application to your utility by April 14th. Construction does not have to be complete by April 14th.

What if I already have solar and want to add a battery?

Unlike adding panels, existing solar users can add a battery at any time without affecting their rate plan or lock-in status.

What if I have solar and sell my home?

If you are a NEM1 or NEM2 customer and you sell your home, the new owner will take over the remainder of your lock-in period.

However, this will be different under NEM3, which has a shorter, 9-year lock-in period that is lost when a home is sold.

I buy my electricity from a community energy provider or municipal utility. Does the CPUC’s decision affect them?

No. The CPUC’s decision does affect community choice energy providers, but some may choose to give their customers a higher credit. The CPUC’s decision does not affect locally governed utilities such as LADWP.

Are you on the best base PG&E rate plan?

Could you save by switching to another rate plan? Take a quick look at your options. Find your best rate plan. Run your personalized electric rate plan comparison. Start Saving Energy Today. View Ways to Save Energy. Review Your Options. 

PG&E has three man residential rate plans that it currently offers; Tiered Rate Plan (E1), Time-Of-Use Plan, and Electric Vehicle base Plan. If you have solar, you’re on Net Energy Metering Add-on Plan.

PG&E To Go Bankrupt?

PG&E To Go Bankrupt?

Shares of PG&E Corp. — which owns Pacific Gas & Electric Co. — sank 22.3% to $6.36 on Tuesday, Jan 16, after reports that the utility could face at least $30 billion in liability related to fires and has confirmed it is filing for bankruptcy protection.

What does this mean to us, the ratepayers? Higher energy rates. MUCH higher.

There’s only one sure way to protect yourself from skyrocketing energy rates: install solar PV PLUS battery backup. Call for a free quote today. (805) 466-5595.

The utility has faced tremendous scrutiny over the last decade, starting with a 2010 gas explosion that killed eight people in San Bruno and continuing with among the deadliest and most destructive fires in state history, some of which may have been sparked by PG&E’s infrastructure. The California Public Utilities Commission is considering breaking up the company as part of an investigation into PG&E’s safety culture.

A potential bankruptcy is seen as putting pressure on California lawmakers to provide a bailout and avoid more turmoil for the state’s largest utility. Whatever the outcome, bankruptcy tends to be “massively inefficient,” said Severin Borenstein, an energy economist at the University of California, Berkeley.

“It freezes the company,” he said. “A judge who has no expertise essentially becomes the CEO. And there are these committees that get involved in every corporate decision.”

This has happened before, and California ratepayers paid the burden. Pacific Gas and Electric utility filed for bankruptcy in 2001 as soaring wholesale power prices and rolling blackouts threw California into crisis. The PG&E Corp. holding company itself never filed for bankruptcy. The utility emerged three years later, its business intact. Under the reorganization plan, ratepayers were responsible for $7.2 billion of the company’s debt from the electricity crisis. This time, that number is north of $30 billion.

Forest fire sign

Bill To Extend California’s Energy Storage Capacity

Bill To Extend California’s Energy Storage Capacity

SB 700 passed the State Assembly

Atascadero, CA, 09/28/18 – Following a rally by an estimated 200 solar workers on August 14, SB 700 was passed 12-5 out of the California Appropriations Committee on August 16. SB 700 passed the State Assembly by a vote of 45-15, and then went to Governor Jerry Brown’s desk for signature. The bill authorizes the continuation of SGIP through 2025, with funding to supply roughly $166 million per year in incentives for qualifying behind-the-meter technologies, or $830 million total. Governor Brown Signed the Bill into law this week.

Behind-the-meter technology refers to battery storage, such as the Tesla Powerwall 2. SGIP, or Self Generated Incentive Program, pays rebates to homeowners who install solar plus energy storage (behind-the-meter technology). By doing so, demand on the energy grid is reduced, during peak hours.

Solarponics, a central California Tesla Powerwall Certified Installer, has over 70 battery storage jobs in production, all of which were made possible by the SGIP rebate program. Homeowners receive a 30% rebate on the install of home battery, or roughly $4,000. SGIP is not only good for the homeowner and energy ratepayer, but is a job creator.

“SB 700 will do for storage what SB 1 did for solar over a decade ago, namely create a mainstream market by driving up demand and driving down costs all while creating jobs and clean energy choices for consumer,” stated CALSSA Executive Director Bernadette Del Chiaro in a press statement. “We are making the sun shine at night!”

PV Magazine reports that battery storage provides an economic edge when dealing with time of use rates, but the problem has been that adding a battery systems typically doubles the cost of a PV installation. And while SGIP has helped to address this problem, battery storage is not becoming affordable for most solar consumers without subsidies in the timeframe of the expiration of the SGIP program. Furthermore, SGIP rounds have been quickly subscribed, meaning that there is much more demand than available incentives to date.

Bill sponsor, Senator Scott Wiener, had this to say to SolarWakeup after the bill passed:

“We are one step closer to meeting our aggressive renewable energy goals,” said Senator Wiener. “By expanding our use of energy storage we will be able to use solar power every hour of the day, not just when the sun is shining. This bill will also help to expand solar use in every city and neighborhood in California, not just those that can afford it. SB 700 will ensure that all communities benefit from these rebates and from an increase in renewable energy.”