We’ll explore the key changes brought about by NEM 3.0 and what it means for California homeowners. Learn how to take action to ensure you get the most out of your solar investment.
As a homeowner, it’s important to understand what these metering policy changes mean for solar owners. Find out how to prepare for NEM 3’s major impact.
The California Public Utilities Commission (CPUC) recently approved a sweeping change in the rooftop solar industry. They voted unanimously to implement Net Energy Metering 3.0 (NEM).
NEM 3 affects customers of Southern California Edison, San Diego Gas & Electric, and Pacific Gas & Electric.
This new policy reduces payments to solar customers for solar energy sent to the grid from $0.30 per kWh to only $0.08 per kW. This is a huge 75% reduction in export rates.
This new policy is set to take effect on April 15, 2023. It will make California rooftop solar projects economically unviable without an attached battery backup system.
However, if your interconnection application is approved for grid interconnection before April 15th, it will be grandfathered into NEM 2.0 rates.
What To Do Right Now About NEM 3.0
If you haven’t gone solar yet, get moving to lock into NEM 2 before it’s too late. We recommend using EnergySage to get quotes from vetted, qualified solar installers quickly and efficiently.
This decision by the CPUC is a major step backward for the clean energy future of California.
The recently proposed decision to reduce net metering rates is a significant reduction. It will have a major impact on energy costs for utility customers with solar in California.
Rooftop solar generation is a valuable energy source for many reasons. It provides clean and efficient power, reduces transmission infrastructure, provides backup power and grid services, and supports small businesses.
NEM 3.0 And Battery Storage
NEM 3.0 encourages the use of stored solar energy during the peak window of 6 p.m. to 9 p.m.
To maximize the value of your solar panels under NEM 3.0, the best option is to bundle solar panels with a battery storage system. This way, you can take advantage of the most profitable exports while avoiding high retail utility rates.
During the day, your solar production can power your home or charge your battery. Excess power will be sent to the grid for credit, but it’s critical to time it right.
At night, your battery can power your home. Or you can use inexpensive electricity from the grid at night, saving your power for peak rate periods.
A solar and battery storage system can maximize your clean energy investment returns and be programmed for optimal energy use.
Key Points About Battery Systems
Remember that adding a battery to a solar system means a higher initial cost that extends the payback period. There’s also a relatively short warranty (with 12 years being the best in the industry, while most have 10-year warranties).
Permitting and installation timelines are longer. Plus, there are more supply chain issues and constraints due to shortages of battery components.
These concerns will increase with the implementation of NEM 3.0. Battery demand will surge.
Work with certified energy storage installers. Ensure they have experience with the local permitting and solar installation process to reduce the timeline associated with installing a battery system.
Solar energy is still a wise financial decision for homeowners. It is a reliable way to minimize electricity costs and keep them stable.
It’s essential, however, to set up your solar system correctly under NEM 3.0 to get the maximum benefit from it. NEM 3.0 adds additional funds for battery storage rebates which helps reduce the cost of rooftop solar plus energy storage.
Combining solar energy with battery backup is the key to getting the most out of solar under NEM 3.0. This combination allows you to use the energy you generate when it is most valuable while avoiding higher retail rates. You can send your excess electricity back to the electric grid, increasing profitability.
The greatest advantage of a battery backup system is that it can provide power during an electric grid failure when you need it most. The power grid’s reliability won’t matter to you when your energy resources provide solar electricity!
Key takeaways from EnergySage’s review of the NEM 3.0 decision:
- “Solar shoppers who submit interconnection applications after April 14, 2023, will be under NEM 3.0 and could miss out on 60 percent of solar savings unless you add battery storage to your solar installation.” EnergySage News
- “Californians considering solar should go solar as soon as possible (and definitely by April 14) to lock in more favorable net metering credits.” EnergySage News