Net Energy Metering 3.0 Billing and How It Affects Solar Energy
As of April 15, 2023, any new solar energy users will abide by a new net energy metering system called NEM 3.0. If you installed solar energy in your home during the NEM 2.0 rules, you are grandfathered in, and your billing plan will continue as before.
What Are the Terms of NEM 3.0?
NEM 3.0 introduced a new credit system from the energy companies that will return about 75% less than before when it comes to earning credit for putting extra energy back into the California grid. For example, under NEM 2.0, if you push a kWh of electricity onto the grid, you will receive a credit for the equivalent – 1 kWh of electricity pulled off the grid.
Even though you have solar panels on your home, you still use electricity from the grid as you run the air conditioning through the night and turn on lights and appliances. Without battery storage, you still rely on the California grid when the sun is down.
Now instead of a one-for-one deal, California residents will receive credits from electricity companies that are more equal to the wholesale price of electricity. This steep decline will not reduce your bill as much as it did before. In fact, because you barely get any incentive to push the electricity back to the grid, you will benefit more under NEM 3.0 when you pair solar panels with battery storage so you can be free of the need to use the California electricity grid altogether.
Pair Battery Storage with Solar Panels to Save Even More
Net energy metering 3.0 does not reward you much for pushing electricity back to the grid, so why not keep the extra energy from the sun to use in your home while the sun goes down? Instead of using the city power at all, you can become utterly self-sufficient through solar panels plus battery storage.
NEM 3.0 encourages homeowners to use solar panels and battery storage to become independent and take pressure off the grid. Because there are no incentives to donate your extra energy converted by your solar panels, you can invest in a full battery storage system instead.
NEM 3.0 Does Not Include Any New Charges or Fees
Solar taxes are not included in NEM 3.0, which is good news. So while your solar credits are not worth as much in California as they used to be, at least you will not have to pay extra money as a solar energy household.
NEM 3.0 Means Longer Payback Periods and Fewer Cost Savings
It’s a hard truth, but without the increased cost savings that NEM 2.0 used to offer, you can expect longer payback periods for your solar investment. Over the lifetime of your solar panels, expect to save between $60,000 and $70,000 as opposed to cost savings of over $100,000 in the past.
The good thing is that if you are a new solar user, you have nothing to compare the new plan to. You will still experience lower energy bills and increased savings from using energy from the sun. In addition, you will reap the benefits of reducing your carbon footprint, taking pressure off the grid, and having electricity during power outages.
Is Solar Energy Still Worth It After NEM 3.0?
If you wonder if solar panels for your home are worth it without the full credits from the energy company, the resounding answer is YES. As we stated before, you can still expect more than $60,000 in savings over the solar panels’ lifetime. The savings are competitive and in line with solar savings in other states. In fact, they are among the best solar savings in the United States.
Solar energy is beneficial to the environment and will increase your home value. You will set an example for your neighbors and children as you make choices that are less impactful on the environment. Solar energy is not just about monetary savings, even though you will see plenty of that.
Are you ready to make the move to solar energy in California? Regardless of NEM 3.0, solar panels are still the best choice for your home to produce renewable energy from the sun to power your refrigerator, HVAC system, lights, and other appliances. Even during NEM 3.0, investing in solar is never a bad idea.
Call New Day Solar
We can help you understand solar and weigh the pros and cons of getting solar panels for your home. If that interests you, call our pro team at New Day Solar for a free consultation: (855) 444-6329.
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