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What Is Happening With Nem 3.0? Update

Update on NEM 3.0

As discussed previously, the California Public Utilities Commission (CPUC) proposed and voted on Net Energy Metering (NEM) 3.0. With the current version of NEM 3.0, some changes have been proposed and are still up for debate.

Read along as we discuss some of the frequently asked questions since the CPUC’s passing of NEM 3.0.

Base export compensation rates - PG&E Weekdays graph

The CPUC named NEM 3.0 the Net Billing Tariff (NBT). NBT took effect on projects that submitted their application after the deadline of April 14, 2023. As mentioned above some of the details of this tariff are still being discussed and have not been formally approved however CALSSA does state that the remaining disputed items should not have major changes.

Is There Still a Minimum Bill Under NBT?

Yes, the residential minimum bill is still active with NBT. Customers will receive a monthly bill that consists of a minimum monthly charge that cannot be offset by solar credits and either a charge or rollover of extra Net Billing Credits. Residential customers must pay the amount owed each month, if any. This avoids the surprise of a large true-up bill at the end of the year. With the fixed minimum monthly bill many customers began to question why they are still receiving an annual true-up.

Why is There a True-Up When Customers Now Get Billed Monthly?

NBT is different from NEM-1/NEM-2 in that customers will be paying their true-up on a monthly basis if they are not a net generator on an annual basis. If the customer has excess credits at the end of the month, they will roll over to the next month until true-up. However, for most customers under NBT their charges will outweigh their credits due to the low export rates offered leading to a monthly payment of their charges. Just like NEM-1/NEM-2, if the customer has credits at the end of the month, those credits are rolled over to the following month until the annual true-up. At true-up, any net excess credits will be calculated based on each utility's Net Surplus Compensation Rate.


What Exactly Is Locked in During the Nine-Year Legacy Period?

The export rates will be locked in for 9 years at the values that are in place in the year of interconnection. These export rates are hourly, and vary for each month, and for weekdays and weekends. Each year will be different. The current calculator has values for the current year along with each individual year in the future. It is those future values that are locked in as they appear in the current version of the calculator. After nine years, you will still be paid for avoided costs, but it will be according to the version of the calculator that is in effect at the time.

Other Frequently Asked Questions:

  1. Is the lock-in determined by the time of application submittal or interconnection? Interconnection
  2. In a change of ownership, can the new owner reapply for adders? No
  3. Does this decision impact municipal utilities? No

If you’re ready to go solar and want to receive a free precise quote, contact us today at (661) 535-0795 to set up an appointment today with one of our solar educators.

Recourses from this article: NEM-3 FREQUENTLY ASKED QUESTIONS | CALSSA