Those contemplating solar energy as a way to fight record inflation could find their savings greatly diminished if a proposed net metering policy (NEM) takes effect.
Last December, the California Public Utility Commission (CPUC) published a proposed decision for the new NEM 3.0 policy. Although a vote was anticipated in January, CPUC delayed a final decision and went back to make revisions in the face of public opposition. Those revisions are still uncertain.
“The CPUC is proposing changes to the existing Net Energy Metering (NEM) 2.0 program at the request of the utilities to 'update' the program," Emily Langenbahn, Renova Energy's policy and public relations manager, said. "The utilities allege the compensation rate for solar energy production is too high, so they would like to lower that rate and impose additional fees for solar owners wherever possible.”
Langenbahn explained there could be wide-ranging impacts for residents going solar, saying "The proposed changes are all over the map."
Vocal backlash from both the rooftop solar industry and ratepayers forced CPUC to "back off and make revisions," Langenbahn said, adding "We have not seen those revisions to date."
She anticipates that CPUC will release another proposed decision this coming December.
Among the changes to the existing Net Energy Metering (NEM) 2.0 program from the initial proposal was renaming NEM as “net billing,” covering all customers of Pacific Gas and Electric Company (PG&E), Southern California Edison (SCE) and San Diego Gas & Electric (SDG&E) who install solar after implementation.
Another change with financial consequences would be adding a monthly Grid Participation Charge of $8 per kilowatt (kW) of solar to the bills of all people who go solar after implementation of the new rules. This is expected to cost the average homeowner almost $600 per year, or $15,000 over 25 years.
Also proposed was an increase in payback times for the average homeowner to as many as 12.2 years for non-low-income customers and up to 18.6 years for low-income customers. Currently, the payback period is five to seven years for cash purchases.
The CPUC's ultimate decision could drastically impact Californians looking to go solar or usher in an era of growth. If the proposed changes go through, existing solar customers will be grandfathered into their original net metering policy, however, fewer benefits will be available for new owners who want to switch to solar. Utilities are recommending two fees for solar customers that, combined, could cost new PG&E, SCE and SDG&E solar customers an average of more than $100 per month.
Coachella Valley’s leader in the field of solar installation, Renova Energy is an award-winning company with expertise installing solar systems and batteries that withstand harsh desert conditions and produce maximum savings. The company employs over 300 people who installed 11,502 kW of solar power in 2021. Since its founding in 2006, Renova Energy has installed 70 megawatts (MW) of rooftop solar for both residential and commercial buildings.