U.S. Congress concerned about NEM 3.0 in California: What homeowners need to know about net metering
Net-metering allows homeowners and businesses to receive bill credits for the excess electricity their solar panels produce. Congress is concerned about the changes.
The California Public Utilities Commission (CPUC) is nearing the end of designing NEM 3.0, and the changes that have been proposed could greatly reduce the financial benefits people can get by owning solar panels or subscribing to community solar.
The CPUC was expected to announce a decision at the end of September in its long-running proceeding known as net metering 3.0. The commission has already postponed the decision once, following a public uproar against its initial, pro-utility proposal, which Gov. Gavin Newsom himself acknowledged last January needed revisions.
The rooftop solar boom threatens to upend the utilities’ highly profitable monopoly control of the state’s electricity. And they have aggressively lobbied regulators and politicians to throttle the competitive threat of consumer-owned power generation.
Congressional letter urges California Public Utilities Commission not to use the solar and renewable energy storage policies in the Inflation Reduction Act (IRA) as justification for cutting solar incentives in the forthcoming Net Energy Metering 3.0 (NEM 3.0) proposal. With the CPUC expected to issue an updated NEM 3.0 proposal by the end of September, the letter calls on the Commission to develop policies that will help increase the deployment of the rooftop solar and residential storage rather than stifle their efforts.
In the letter, Congressman Mike Thompson (California's 5th District) expresses concerns over the matter.
“We write to share our concerns about the potential imposition of any discriminatory fees or drastic and immediate export rate reductions on rooftop solar and storage customers in the net energy metering (NEM) 3.0 proceeding, as such provisions would undermine the goals and intent of the Inflation Reduction Act,” Thompson and his colleagues wrote. “We fought hard to secure robust clean energy incentives in the IRA in order to accelerate the deployment of renewable energy in California and across the United States. Multiple independent analyses have found that these incentives will reduce emissions by approximately 40% by 2030 – but those analyses assume the continuation of supportive state policies.”
Despite the proposed rule changes, the Public Utilities Commission of the State of California (“CPUC”) asserts that If adopted, "we do not expect that the new net metering tariffs would have substantial impact on existing utility scale projects."
Grandfathered customers can stay net metered for up to 20 years from their original enrollment date. After that point, they will also move to the current NEM regulation.
Regardless of the CPUC modifications, homeowners in California with solar panels will continue to save money thanks to solar energy.
Additionally, existing non-low-income residential customers would be required to transition to NEM 3.0 within 15 years of the date of interconnection. All future NEM 2.0 customers, as well as any customers taking control of a residential system, may only remain subject to the net metering rules that applied at the time of their interconnection (referred to as a “legacy period”) for a period of 15 years, instead of the current 20 years afforded by current rules.
Solar energy in California has been and will continue to thrive by helping homeowners save money, while maintaining the planet greener.
At Urban Sol Energy, our vision is to create positive change in our communities and environment by helping our neighbors power their homes, businesses and lives with renewable solar energy. Trusted Solar Advisors for Texas and California.
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Ashleigh is our CEO and Solar Advisor, she has over 6 years in the renewable energy field. From helping universities with RFP processes to switch solar to working on sustainable tourism initiatives in Cuba. Her favorite part of her job is helping make an impact on the community level, one home at a time. In her free time, she loves traveling (10 countries and counting!), checking out wineries, and watching her niece Rachel play basketball.
Here are some additional sources of information about the topic discussed in this article
1. Thompson, Levin Lead Letter Urging CPUC Not to Undermine Solar Incentives