Energy Products

California net metering rates

Interesting article.


  • The basics are that solar export rates of $0.03 to $0.02 per kWh are likely to be reduced (which is already pathetically low), and export rates for battery systems that are set up for on-demand powering the grid may go up. The timing is late 2021.
  • I started out with the E7 rate under the old NEM1 rule. That rate was simply awesome. The payback on a simple 4kW solar without battery was straightforward and heavily advantaged the homeowner. Good rate payback and good time frames for payment - essentially biased in favor of getting well compensated for typical peak production hours. It was closed for new installs on January 1 of 2008 as I recall. The NEM2 rates have successively driven down overall rates and have incrementally reduced the advantage for solar-only systems. The latest iterations under NEM2 have essentially erased financial incentives (export income for the homeowner) for a solar-only install. The only real way to get a check from the utility is to have a battery. A solar-only system becomes essentially a mechanism to simply reduce or eliminate a utility bill under NEM2. Solar-only systems should not expect a true-up check and would be expected to be near zero utility bills only under best of conditions.
    The pencil pushers at the utilities are not a stupid crowd - they can find ways to make a buck by either changing the rates or by changing the schedules - they clearly do both to benefit the shareholders.
    I predict that solar under NEM3 will require a battery to be viable and solar designs will likely evolve to be essentially grid-free under most conditions and use the grid only at times when solar production is insufficient to power the home.
    The utility companies are not our friends nor are they partners. They are here to make a buck for the shareholders and they will find a way to do that. The evolution of rates and schedules clearly demonstrate that.
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