California Members: NEM3.0 impact on NEM1/2 customers and what to do?

[Hedges]

EV + house rate you will get credit at $0.24 (mostly producing in summer), and winter heating will cost you $0.24 ($0.44 3:00 to 4:00), $0.55 in late afternoon to early evening.

Electric Vehicles

With the number of electric vehicles in California growing every day, PG&E is committed to low electric vehicle rates, and home charging for electric cars in California.

www.pge.com

TOU rate $0.42 off-peak in the summer, $0.35 off-peak in the winter $0.48 late afternoon and early evening.

With TOU, you may have a better chance of getting back more winter kWh for heating than you produced in the summer.

 

[fafrd]

Paltry credit is better than no credit (e.g. zero export).
Oversize for summer to reduce import on bad days makes sense.

How much money do you have to pay PG&E to be on NEM 3.0 and receive the paltry credit? Is that still a net savings, or a net loss?
(Include any difference in rate schedule.)

I’m pretty sure it is $0. There may be an initial hook up fee of $100-200, but everyone pays the Minimum Monthly Charge, regardless of whether they are on NEM or not.

I observed that your cost to generate power is about same as the paltry credit, more or less.

Today’s incremental cost to generate an incremental 1kW annually is about the same as the utilities paltry ‘Avoided Cost Calculation’ (which I believe is the intent).

The point is that once you’ve decided to put in a solar+battery system sized to offset annual consumption, you might as well put in the largest system you can hold (up to the 150% limit).

And of course much less than your import cost, which is why some oversize to reduce import makes sense. That's where paltry credit gives you some back.

Yes.

Whether TOU (mandatory for NEM) or tiered is preferable will depend on when and how much power you use.

I don’t believe the utility will let anyone on TOU to go back to tiered. It’s only a matter of time before everyone is on TOU. Restrictions from NEM3.0 that force you onto less favorable rate plans than those offered to non-NEM customers is not a factor I’m considering in this analysis - I’m assuming the same rate plans and Minimum Monthly Charges for all customers, whether NEM or non-NEM…

https://www.pge.com/pge_global/common/pdfs/rate-plans/how-rates-work/Residential-Rates-Plan-Pricing.pdf

As for "oversize", consider "overpanel", which costs a bit less. Inverter meets peak need, PV panels perhaps 2x, to still meets need in less-optimal conditions.

PG&E counts the size of the array itself, not inverter peak capacity. So the 150% limit means you can put in enough solar panels to generate up to 150% of annual consumption. How much inverter capacity you hook up to those panels is up to you (and whatever solar capacity you have on your main panel).

Plan for alternate heat in winter, since when grid fails, NEM won't help. Your battery can carry smaller loads, including furnace fan.

Heating with electricity in winter is always going to be the least attractive alternative.

Those who heat with electricity over winter are certainly going to be disadvantaged by NEM 3.0 versus the much more generous ‘summer-to-winter’ infinite battery NEM1/2 offers…

 

[Ampster]

Can you elaborate a little on this discrepancy?

I don't know the assumptions that PG&E uses so I do not have much insight. I can only guess that they did not look at my entire year. My true up is in October so I am in deficit until March when longer days build dollar credit. I did break my usage and Net generation into the two rate seasons of winter and summer and applied the applicable rate. TOU-C & D have higher rates during the day when sun is shining and that might be part of it.
I am away from computer for a few hours but later I can dig into the numbers if that would help?
EDIT:
My case may be unusual because during the eight months of Winter rates I was a Net consumer of about one mWh of power and during Summer rate period I was a Net generator of two mWhs of power for a Net generation of one mWh at True Up.

 

[400bird]

So, let’s let’s increase the size of the system to offset 24-hour consumption in Spring and Fall. That larger system should offset 150% of summer-months consumption but you can’t export that excess energy so it gets wasted. Now wintertime consumption is offset by 50%, so you are only paying full retail for half of your wintertime consumption, or ~12.5% of annual consumption, but you’ve also got to factor in 9 months of minimum monthly charges ($135).

I agree with your theory, so don't take this as me disagreeing with you.
But, fall and spring are the easiest time of the year to cover demand in my part of California (central valley) I thought it was the same everywhere? I mean as long as the sun comes out, my battery was charged by noon until this storm blew in.

In the winter, short days and higher chance of clouds means significantly less production.
In the summer, high temps mean significantly increased demand.

 

[fafrd]

Paltry credit is better than no credit (e.g. zero export).
Oversize for summer to reduce import on bad days makes sense.

How much money do you have to pay PG&E to be on NEM 3.0 and receive the paltry credit? Is that still a net savings, or a net loss?
(Include any difference in rate schedule.)

I observed that your cost to generate power is about same as the paltry credit, more or less.
And of course much less than your import cost, which is why some oversize to reduce import makes sense. That's where paltry credit gives you some back.

Whether TOU (mandatory for NEM) or tiered is preferable will depend on when and how much power you use.

https://www.pge.com/pge_global/common/pdfs/rate-plans/how-rates-work/Residential-Rates-Plan-Pricing.pdf

As for "oversize", consider "overpanel", which costs a bit less. Inverter meets peak need, PV panels perhaps 2x, to still meets need in less-optimal conditions.
Plan for alternate heat in winter, since when grid fails, NEM won't help. Your battery can carry smaller loads, including furnace fan.

Also, all of my analysis is overlooking the increased credits during peak hours (100% of off-peak rates). So if a slightly larger battery allows you to offset peak-period consumption or even export some excess, a few kWh credited at 7.6 times what they credit you for off-peak export changes the equation quickly…

Summertime daylight/generation hours extend later than daylight hours in Spring and Fall, so even if you only have a battery sized to capture enough excess energy during fall/spring to offset overnight consumption, that will translate to some excess energy you can export during peak hours.

One extra kWh of battery capacity would allow you to export an additional 122kWh a year during the summer months which will give you credit for another 122kWh of consumption during winter months with a value of $23 or $464 over 20 years.

With batteries already down to $284 per kWh, that’s another aspect to factor in…

NEM 3.0 will allow you to break-even on a larger battery in ~12.3 years. Nothing to jump up and down about but not ridiculous (and that break-even point is just going to keep getting shorter as battery costs continue to drop and electrical rates continue to increase…).

 

[Hedges]

Also, all of my analysis is overlooking the increased credits during peak hours (100% of off-peak rates). So if a slightly larger battery allows you to offset peak-period consumption or even export some excess, a few kWh credited at 7.6 times what they credit you for off-peak export changes the equation quickly…

...
One extra kWh of battery capacity would allow you to export an additional 122kWh a year during the summer months which will give you credit for another 122kWh of consumption during winter months with a value of $23 or $464 over 20 years.

Store PV in battery off-peak and export at close to retail on-peak sounds good.

With batteries already down to $284 per kWh, that’s another aspect to factor in…

NEM 3.0 will allow you to break-even on a larger battery in ~12.3 years. Nothing to jump up and down about but not ridiculous (and that break-even point is just going to keep getting shorter as battery costs continue to drop and electrical rates continue to increase…).

Break even just before break-down. I'm not jumping up and down.

$284/kWh capacity, divide by 6000 cycles claimed, is $0.05/kWh of cycle life.
That does get attractive, with on/off peak rates around $0.50/$0.25 and export credits around $0.025
6000 cycles once per day is 16 years. Leveling loads during the day, micro-cycling, will count toward that. I assume it is equivalent full cycles, although some have claimed (at least for forklift lead-acid) that each switch between charge and discharge counts as a cycle. I don't believe that given DoD vs. cycles curves. So I would expect to go by kWh of cycling.

Real key is actual life. A while back a study in Australia cycled batteries, and only 5% lasted as long as spec. Some failed and were repaired.
So I told people here, "Assume 25% of claimed cycle life and try for break-even by then."

 

[fafrd]

I agree with your theory, so don't take this as me disagreeing with you.
But, fall and spring are the easiest time of the year to cover demand in my part of California (central valley) I thought it was the same everywhere? I mean as long as the sun comes out, my battery was charged by noon until this storm blew in.

In the winter, short days and higher chance of clouds means significantly less production.
In the summer, high temps mean significantly increased demand.

Increased consumption over summer months makes the math work out even more favorably.

The worst-case for NEM 3.0 would be if you only consumed during the winter months.

The 87.5% of annual consumption you export during the 9 non-winter months would only give you enough credit to offset 11.5% of your wintertime consumption (ignoring the increased credits you’d get for export during peak hours over the 122 summer days).

I’ll let someone else do the math, but I’m pretty sure consuming 150% or 200% over summer months versus what you consume during the non-summer months including winter makes offsetting all of your annual electrical charges except MMC’s and NBC’s under NEM 3.0 easy-peazy…

 

[fafrd]

Store PV in battery off-peak and export at close to retail on-peak sounds good.



Break even just before break-down. I'm not jumping up and down.

As I stated you should not be, but we’re already beyond the ‘it’s totally crazy’ stage and it’s only going to get better from here.

I paid $0.72/W for my 335W solar panels in 2016 and that was considered a good deal at that time.

I paid $0.39/W for my 380W solar panels in 2021 behold inflation reared it’s ugly head.

We’ll look back in 2026 and see at least that same 46% drop in battery prices (and probably with increased cycle life to boot).

$284/kWh capacity, divide by 6000 cycles claimed, is $0.05/kWh of cycle life.
That does get attractive, with on/off peak rates around $0.50/$0.25 and export credits around $0.025
6000 cycles once per day is 16 years. Leveling loads during the day, micro-cycling, will count toward that. I assume it is equivalent full cycles, although some have claimed (at least for forklift lead-acid) that each switch between charge and discharge counts as a cycle. I don't believe that given DoD vs. cycles curves. So I would expect to go by kWh of cycling.

It’s on the edge of making financial sense for early NEM 3.0 adopters, as it was for the early pioneers investing in NEM 1.0.

But it’s not stupid and will not dissuade those investing in solar for personal reasons rather than financial returns (to reduce personal carbon emissions).

So I don’t believe NEM3.0 destroys the residential solar industry while battery costs and cycle life catch up to where they need to be for the economic incentive to recover.

Real key is actual life. A while back a study in Australia cycled batteries, and only 5% lasted as long as spec. Some failed and were repaired.
So I told people here, "Assume 25% of claimed cycle life and try for break-even by then."

Yes, without cost-effective batteries (including long cycle life), the entire value proposition of NEM 3.0 (as well as that of the entire solar power generation industry) falls apart.

But it’s a pretty safe bet that ever-better battery technology is coming (and again, the same could have been said about solar panels during the first days of NEM 1.0).

 

[Danke]

 

[Ampster]

I will reread this thread and eventually read the CPUC ruling, however if anybody knows the impact NEM 3.0 would have on the sale of a home with a NEM 2.0 agreement, please respond?

I have seen a post on another forum that suggests that a sale of a home with a NEM 1.0 or 2.0 system, would cause the system to be forced into NEM 3.0 regardless of the remaining term left on NEM 1.0 or 2.0.

 

[fafrd]

I will reread this thread and eventually read the CPUC ruling, however if anybody knows the impact NEM 3.0 would have on the sale of a home with a NEM 2.0 agreement, please respond?

I have seen a post on another forum that suggests that a sale of a home with a NEM 1.0 or 2.0 system, would cause the system to be forced into NEM 3.0 regardless of the remaining term left on NEM 1.0 or 2.0.

Go to page 179: https://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M498/K526/498526033.PDF

The final paragraph of that section states ‘no changes being made to NEM 1.0 and NEM 2.0 tariffs’ and I see no mention of any change to rights to pass on the remainder of the 20-year grandfather period to a new owner…

 

[Ampster]

The final paragraph of that section states ‘no changes being made to NEM 1.0 and NEM 2.0 tariffs’ and I see no mention of any change to rights to pass on the remainder of the 20-year grandfather period to a new owner…

Thanks, I would agree there is no mention. I guess we will have to see the actual Sucessor Tariff or subsequent rulings to see if there is a change that could affect the transferability of an original NEM 1.0 or 2.0 agreement. It is clear that NEM 3.0 seems to be for only 9 years and it is not transferable.

 

[fafrd]

Thanks, I would agree there is no mention. I guess we will have to see the actual Sucessor Tariff or subsequent rulings to see if there is a change that could affect the transferability of an original NEM 1.0 or 2.0 agreement. It is clear that NEM 3.0 seems to be for only 9 years and it is not transferable.

Yes, NEM 3.0 will be less generous that the NEM 1.0 and NEM 2.0 programs in that regard.

But I believe legacy NEM 1.0 and NEM 2.0 customers will be unaffected and the terms of their original agreements have been left intact.

At least for now - there will no doubt be another review in ~5 years and I am certain all of these same subjects including shortening the grandfather period of NEM 1.0 and 2.0 agreements as well as adding a ‘solar tax’ are almost certainly to be requested and considered again…

At least the CPUC’s Preliminary Decision from late 2021 has provided us a blueprint for what worst-case changes we may be facing 5 years from now (and hopefully that runway and improved product offerings emerging in the interim will allow us to be better prepared for any such change).

 

[Calvin98]

I guess I can throw it in again, my neighbors are still at 23+ years with their NEM1. I hope batteries will be cheaper and better by then.

 

[Ampster]

I guess I can throw it in again, my neighbors are still at 23+ years with their NEM1

Are you saying that their NEM 1.0 approval was 23 years ago. If that is the case and I were in their shoes, I would be worried that in April that I would be notified that I was then on NEM 3.0.

 

[Calvin98]

Yes. But why did they not get put into nem2 3 years ago if it is a 20 year limit? The post above seems to say that nem1 peole won’t get changed. But lots of confusion and contradictory info.

 

[Ampster]

Yes. But why did they not get put into nem2

Because it is more advantageous for their utility to kick them into NEM 3.0 in one step then a two step process of NEM 2.0 for a few years when there was no definitive date for NEM 3.0 to begin when the NEM 1.0 agreement expired.

 

[mxp]

Hello,
I have an existing 2015 installed 6kW solar (28 x 250W panels with individual power optimizers, on a single Solar Edge inverter) on NEM1, and some years before NEM1 expires (2035).
I am thinking of installing a Tesla branded separate and independent circuit 6.4kW or 4.8kW solar only system (no battery) (400W x 12 panels or 400W x 16 panels attached to its own Tesla inverter).

This situation will effectively reset my existing 2015 NEM1 solar to NEM2 upon installing the new Tesla solar panels and inverter panel.
Also, I noticed Tesla solar does not use "power optimizers", to keep their solar per watt pricing lower (around $2.8/W). Not sure if my overall yield will be beneficial combined and on NEM2 pricing with old plus new panels.

Should I go with additional Tesla panels and pre-maturely switch over to NEM2 for both the existing and new panels installed?

I still have 12 years left on NEM1 but forced to stay on 6kW. A buddy of mine also told me, that I can hire an electrician to add up to 4 extra 250W panels on the existing Solar Edge inverter without nulling the NEM1 and save some money... I know that an extra 1kW isn't going to help much

Please help me decide....
Thanks for any advice!

Tesla rep told me I need to make a decision soon to be admitted into NEM2....

 

[fafrd]

Hello,
I have an existing 2015 installed 6kW solar (28 x 250W panels with individual power optimizers, on a single Solar Edge inverter) on NEM1, and some years before NEM1 expires (2035).
I am thinking of installing a Tesla branded separate and independent circuit 6.4kW or 4.8kW solar only system (no battery) (400W x 12 panels or 400W x 16 panels attached to its own Tesla inverter).

This situation will effectively reset my existing 2015 NEM1 solar to NEM2 upon installing the new Tesla solar panels and inverter panel.
Also, I noticed Tesla solar does not use "power optimizers", to keep their solar per watt pricing lower (around $2.8/W). Not sure if my overall yield will be beneficial combined and on NEM2 pricing with old plus new panels.

Should I go with additional Tesla panels and pre-maturely switch over to NEM2 for both the existing and new panels installed?

I still have 12 years left on NEM1 but forced to stay on 6kW. A buddy of mine also told me, that I can hire an electrician to add up to 4 extra 250W panels on the existing Solar Edge inverter without nulling the NEM1 and save some money... I know that an extra 1kW isn't going to help much

Please help me decide....
Thanks for any advice!

Tesla rep told me I need to make a decision soon to be admitted into NEM2....

Pretty sure that if you switch to NEM 2.0 you will only get 12 years before you are forced onto NEM 3.0. You need to decomission and uninstall your existing NEM 1.0 array and re-apply as a new NEM2.0 install if you want a new 20-year grandfather period...

 

[mxp]

Pretty sure that if you switch to NEM 2.0 you will only get 12 years before you are forced onto NEM 3.0. You need to decomission and uninstall your existing NEM 1.0 array and re-apply as a new NEM2.0 install if you want a new 20-year grandfather period...

Hi, I didn't even think about this procedural step...

I always assumed, that when my 2015 solar install, expires in 2035, PGE will just automatically apply NEM3 to my bill. As the end user, there is nothing to do on my part. Can you pls help clarify my understanding if it is wrong? My assumption here is, I will still continue to have one PGE bill, which will reflect a combined total of kWh generation of both the arrays. They will both be treated as a NEM2 for the next 20 years.

In essence, I assumed, in the scenario which I am suggesting in my original post, If I get into NEM 2.0 now before the dateline, by adding a new Tesla solar system, and my existing old 2015 solar array system gets converted "at the same time" from NEM1 to NEM2 due to the addition of that new Tesla solar when it goes "online". My new PGE bill will reflect NEM2 for the next 20 years with both the combined old 2015 and new 2023 solar arrays, right?

Sorry if I didn't understand your reply earlier.