Introduction: A New Era for Solar Energy in California
In late 2022, the California Public Utilities Commission (CPUC) made a pivotal decision that has far-reaching implications for the future of solar energy in the state. Known as Net Energy Metering 3.0 (NEM3), these new regulations are set to take effect in mid-April 2023. At San Diego County Roofing & Solar, we understand the concerns that many homeowners and businesses have regarding these changes. This article aims to answer the most pressing questions about NEM3 and its impact on solar users.
What is NEM3 and When Does It Take Effect?
NEM3 is the third iteration of California’s rooftop solar rules, focusing on “net energy metering.” This version was adopted by the CPUC in late 2022 and will be implemented starting in mid-April 2023. If you installed your solar panels before this date, you would be classified under NEM1 or NEM2, depending on when your solar system was activated.
How NEM3 Differs from Previous Versions
One of the most significant changes under NEM3 is the reduction in compensation for excess solar energy shared with the grid. Solar users will now receive 75% to 80% less from utilities for this extra energy. The average rate will drop from approximately $.30 per kWh to around $.05 per kWh. Additionally, NEM3 users will be subject to rate plans with higher evening electricity rates, extending the payback period for solar investments from six years to over ten years.
Grandfathering: What Happens to Existing Solar Users?
If you are an existing solar user under NEM1 or NEM2, the new rules will not affect you until your 20-year lock-in period expires. For example, if your solar system was activated in 2019, you would transition to NEM3 in 2039. However, if you plan to add more panels to your existing system, there are specific conditions you need to be aware of, as discussed in the next section.
Adding More Panels or a Battery: What You Need to Know
Expanding your solar system by 10% or 1kW will automatically transition you to NEM3. If you’re considering this, it’s advisable to complete the expansion before mid-April 2023. On the other hand, adding a battery to your existing solar system will not affect your lock-in status under NEM1 or NEM2.
Selling Your Home with a Solar System
If you’re a NEM1 or NEM2 customer and decide to sell your property, the new owner will inherit the remainder of your lock-in period. However, NEM3 introduces a shorter, 9-year lock-in period that is not transferable upon the sale of the property.
How to Get Solar Before NEM3 Takes Effect
If you’re contemplating installing solar panels before the new rules kick in, ensure that you have a signed contract with a solar provider like San Diego County Roofing & Solar and submit a complete interconnection application to your utility by April 14th, 2023.
Finding a Reliable Solar Installer
When it comes to roofing in San Diego, especially with the integration of solar systems, choosing a reputable company is crucial. San Diego County Roofing & Solar is among the leading local roofing companies in San Diego, with extensive experience in solar installations.
Community Energy Providers and NEM3
The CPUC’s decision also impacts community choice energy providers. While some may offer higher credits to their customers, locally governed utilities like LADWP are not affected by these changes.
Conclusion: Preparing for the Future of Solar Energy
Understanding the intricacies of NEM3 is essential for both current and prospective solar users. As one of the premier roofing contractors in San Diego, we are committed to helping you navigate these changes and make informed decisions about your solar investments.