As of April 14, 2023 PG&E along with other utilities, imposed an Alternative Energy Net Metering Program that significantly changes how homeowners with Solar PV or any other Alternative Energy Source acquire energy credits for power pushed back onto the grid.
- NEM 3.0 reduces the credit from retail rates to wholesale rates.
- Imposes a basic non adjustable service fee to increase the base bill
This sounds like the end of Solar PV viability, however that’s the furthest from the truth. Since Solar PV and Energy Storage Systems (batteries) have become much less expensive with more streamlined installation processes the NEM 3.0 rate change is truly of no impact. Especially for those not seeking back up power who can expect a ROI in 5-6 years, batteries included. However back up power simply adds a few years to that pushing ROI out to 8-9 years. Still better than a kitchen remodel or paying high bills every year. Especially since quality Solar PV and ESS warranties are transferable, increasing home values.
Here’s how it works:
- Previous to NEM 3.0 a 9.0Kw Solar PV system costs about $24,000.00 before tax credits are applied. $16,800.00 after claiming the tax credit
- $350.00 monthly average utility utility bill x 12 months = $4,200 x 4years = $16,800 for 4 years to full ROI
- After NEM 3.0 a 9.0Kw Solar PV system with 10Kwh ESS battery storage costs about $28,500.00 before tax credits are applied. $19,950.00
- $350.00 monthly average utility bill x 12 months = $4,200 x 4.75 years = $19,950.00 for 4.75 years to full ROI
Using 10Kwh of ESS (battery)* you will keep the extra power your solar produces. Then everyday, the ESS will discharge power during the TOU Peak Rates eliminating them from your bill. (typically PG&E charges .44 cents per kwh during this period)
- Adding an additional 5Kwh of ESS at this point is only $4,000.00 if you need more storage to get through those evening rates.
Since we now can install a 9.0kw system on almost any home due to new technologies that safely release us from previous code restrictions the 9.0kw with energy storage is very very viable.
Illustrates a Solar PV system (blue) with ESS storing power (green) and using excess stored power (orange) to run the house. Complete grid independence with this design.