The California Public Utilities Commission (CPUC) stated that it would reopen the record on its NEM 3.0 solar net metering program to gather more evidence. The CPUC’s recommendation on NEM 3.0 date will be extended to July 2022. The reopening of the record will affect residential solar homes in California. If you need solar panels for your home, you should consider installing them before deciding, making solar more expensive.
The CPUC Reopens NEM 3.0 Program and Extends the Decision Date
For almost a year, the CPUC has studied modifications to net energy metering to sustain the public’s utility interests. Its original recommendation, which included a hefty tax on rooftop solar and an immediate exclusion of credits for solar users, would be expensive for most consumers. The CPUC shelved the controversial decision amid considerable public opposition and disapproval. It was good news for residential solar as the CPUC postponed NEM 3.0 decision.
Now, the CPUC is reviewing the problem and soliciting public comments on a structure acceptable to the nation’s biggest solar industry, which accounts for a significant proportion of all solar rooftops in the United States. The commission seeks public opinion on the non-bypassable charges on gross solar consumption and the distribution of energy sources to the community. However, the proposed decisions may reduce the number of residential solar homes in California. Here’s what homeowners need to know, how the proposed changes will affect residential solar.
Changes to New Time of Use Plans (TOU)
The new proposed changes require residents who wish to put solar panels on their homes to sign up for a “highly differentiated” Time-of-Use rate, which is highly costly during peak grid consumption hours and substantially cheaper at other times. The CPUC recommends encouraging solar panel installers to incorporate battery storage. Therefore, a TOU rate with high per-kWh prices during nighttime peak hours will reduce solar owners’ savings.
A Rise in Monthly Fixed and Capacity Charges
The CPUC will add some fees you will not avoid as a residential solar homeowner. Switching to the currently-approved TOU plans will result in higher monthly fixed costs for customers. Moreover, the proposed decision adds an $8 monthly fee for every installed kilowatt-hour (kW) of solar to the customer’s account. It would result in a monthly cost of $48 for a typical customer who installs a 6kW solar system on their house, which will immediately affect their savings from installing solar panels and cannot be reduced. That’s $14,400 over a solar system’s 25-year lifespan. Low-income customers who qualify for CARE rates will be exempt from the $8/kW fees.
What NEM 3.0 Reopening and Date Extension Means for Residential Solar
The CPUC’s proposed decisions may not change NEM 3.0’s contentious issues, especially on solar taxes. It means that residential solar will be expensive for most homeowners after the final decision. However, the CPUC’s NEM 3.0 decision-making date extension provides potential solar consumers more time to install solar panels before the final decision.
At Solar Optimum, we can assist you in initiating, approving, and installing your solar project before the NEM 3.0 final decision to avoid additional expenses. Contact us today for more information and begin your solar project.