Defying overwhelming public opposition, state officials voted in late 2022 to make drastic changes to California’s rooftop solar rules (called “net energy metering”). The decision by the California Public Utilities Commission (CPUC) will make it much more expensive to get rooftop solar starting in mid-April 2023. The decision mostly affects those who do not yet have solar, but can affect existing solar users under certain circumstances as well.
NEM3 is shorthand for the third version of the state’s rooftop solar rules (called “net energy metering”). NEM3 was adopted by the CPUC in late 2022 and will take effect in mid-April 2023. Solar users who got their solar before NEM3 are referred to as NEM1 or NEM2 depending on the year their solar turned on.
Solar users under NEM3 will get 75% to 80% less from the utility for the extra solar energy they share with the grid. Compensation for that extra energy will go from an average of $.30 / kWh to around $.05 / kWh. NEM3 solar users will also be put on a rate plan with higher evening electricity rates. These changes will extend the payback period for a solar investment from an average of six years to more than ten years. CPUC NEM3 decision
The CPUC’s new rules will not affect NEM1 and NEM2 solar users until your lock-in period expires, unless you add more panels (more on that in the next section).
The NEM1 and NEM2 lock-in period, also known as grandfathering, is for 20 years after the utility turned on your solar system. Here’s two examples:
After NEM3 begins, existing solar users who increase their system size by 10% or 1kW, whichever is more, will be forced onto NEM3. You may want to consider adding panels before NEM3 goes into effect in mid-April 2023.
If you want to add panels before NEM3 takes effect, your solar company must submit a correct and complete interconnection application to your utility by April 14th, 2023. Construction does not have to be complete by April 14th, 2023.
Unlike adding panels, existing solar users can add a battery at any time without affecting their lock-in status.
The rules are different depending on your utility:
Pacific Gas and Electric (PG&E):
Your installer needs to permanently disconnect your existing system from the grid.
You must call the PG&E Solar Customer Service Center and ask PG&E to cancel your existing system.
Your installer must submit a complete and correct interconnection application before April 14th for the new system. Construction does not have to be completed by that date.
San Diego Gas & Electric (SDG&E):
The installer can submit an interconnection application while your current system is still functioning. Your installer needs to make a note that the existing system will be removed before the new system is given permission to operate.
Before the new system can turn on, the installer must submit pictures proving that the old system has been removed.
Southern California Edison (SCE):
If your 20 year lock-in period is about to expire, the only way to avoid getting put on NEM3 is to completely remove your current solar system and replace it with a new one.
Recommended article:If you do this, a complete and correct interconnection application must be submitted to the utility by April 14th (construction can be completed after that date).
You must remove the old system before submitting an application for a new one.
If you are a NEM1 or NEM2 customer and you sell your home, the new owner will take over the remainder of your lock-in period.
However, this will be different under NEM3, which has a shorter, 9-year lock-in period that is lost when a home is sold.
Yes, if you have the following two things in place by April 14th, 2023 then your solar system will be put on the current program, NEM2, for 20 years:
Construction does not have to be completed by April 14th, 2023.
Our Consumer Guide has guidelines for finding a solar company, as well as other resources.
The CPUC’s decision does affect community choice energy providers, but some may choose to give their customers a higher credit. The CPUC’s decision does not affect locally governed utilities such as LADWP.
Got a question you don’t see here? Email [email protected].
Right now is the best time to install solar panels. We know it seems like it defeats the purpose of installing them in January when the days are short and the nights long, but trust us, we know what we’re talking about! It’s absolutely imperative that anyone who is searching for solar panels in Gateshead books their installation as soon as possible, and here’s why!
Solar panels generate the most electricity between April and September, when there is over 12 hours of daylight every day. This period is called the solar bell, which we’ve explained in a previous blog post. Since publishing that post, lots of new information about the energy price rise we’re expecting to see in April has come to light.
Right now, we are expecting the price cap to drop by £600 between April and June, according to Cornwall Insights. However, prices could still be totalling £1,836.23 per month in the second quarter of 2023. It’s imperative that you get ahead of the curve and install solar panels now, in order to see even more of a reduction on your energy bills from the outset of the optimum solar season.
Thrift Energy currently has the man power and the stock to do a full solar installation in four weeks. If you were to apply today, this would mean that you would have a full solar system in place and operating before the optimum solar season arrives in April. This is especially important if you plan to apply for your solar panel system using funding or finance options, as the application will need to be approved before work can begin.
The best way to save money on your energy bills is to use a renewable energy option, such as solar panels, alongside other energy efficiency measures like insulation. In April 2023, we are expecting to see the launch of the Eco+ Scheme. This will see households all over the UK, who could not previously access to government grants, now be able to use funding to financially assist them with installing insulation measures.
It is anticipated that this scheme will be incredibly popular and will receive an influx of applicants in April. In order to avoid being disappointed if you do not manage to get funding from this scheme, while also ensuring you have a measure in place that will reduce your energy bills in the meantime, we recommend applying for a solar panel system prior to April 2023.
It’s time to talk about the Smart Export Guarantee. Whilst every tariff available on the SEG is different, depending on the provider you choose, the principle is the same; you will be paid for any low-carbon electricity you generate and deliver back to the National Grid, as long as the correct criteria is met. Small-scale generators could earn up to £110 a year, according to MoneySavingExpert.com. When you combine this reimbursement with the hundreds (or even thousands) of pounds you will save on your energy bills after installing solar panels, the decision seems like a no brainer.
As we all know, we’re in the midst of a climate emergency. 2022 was the hottest year on record for the UK, especially after our record breaking summer, and we need to do our utmost to prevent the situation on our planet from getting any worse. Installing solar panels is an easy way to do this, as it means you will generate energy for your home through a renewable source. Now is the time to take the easy path to contributing to a sustainable future.
If you’re still feeling non-committal about installing solar panels this year, we recommend talking to an experienced member of the Thrift Energy team on 0191 284 2424. They’ll be able to help you with any concerns, and give you even more reasons to make the conversion to solar energy!
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