NEM3, Net Billing Update

November 17, 2022

The CPUC recently released its latest NEM-3 or Net Billing proposed decision. According to our trade association, CALSSA, the proposal is still extreme. Here are the key takeaways:

The good:

  • No “Grid Access Charge” or solar tax was included.
  • There will be no additional “Non-Bypassable Charges” applied to behind-the-meter consumption.
  • Existing customers will be able to maintain their current NEM agreement, preserving the well-established 20-year grandfathering for NEM-1 and NEM-2 customers.
  • The 120-day sunset period remains. Projects that get initial PG&E interconnection permission within 120 days of the vote will be on the current (NEM-2) agreement.

The bad:

  • The export credit has an immediate 75% drop from 30 cents, on average. This is the biggest hit to California’s solar market in history. It would make the payback periods for residential solar nearly 50% longer than they were under NEM-2, and that’s with the 30% Investment Tax Credit.
  • The export rates are very complex, too complex to detail here. Suffice it say that manufacturers, contractors, and customers will have a hell of time being strategic about energy consumption.

The action:

  • Sign a public comment to Governor Newsom and the CPUC. This is the same public comment as last year so if you’ve already signed it, don’t sign it again.
  • Commercial customers: Endorse our campaign here.
  • Read more about it here.

Assuming this decision passes next month, the race will be ON to get solar installed before the sunset period expires in 120 days. Solar contractors will be swamped.

If you or someone you know is considering a solar installation NOW IS THE TIME to move forward.