California Supreme Court To Hear Home Solar Rate Case And It’s A Mess

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NEM3

I founded ClariNet, the world's first internet based business, am Chairman Emeritus of the Electronic Frontier Foundation, and a fellow of the Foresight Institute. My current passion is self-driving vehicles and robots.

Charging cars directly from solar in parking lots is fine, but they can also be on the roofs of theto a challenge of the new financial structure for people with solar panels on their homes known as “NEM 3,” which went into effect in 2023. Compared to the old NEM 2 rules, solar panels became much less financially lucrative for homeowners, which has significantly curtailed demand and been catastrophic for many home solar installers.

It’s a huge difference. On NEM2 you effectively sell your surplus power for prices ranging from 36 to 54 cents/kWh. On NEM3 it’s estimated to be around 5-6 cents. No small difference. Right now, though, people like to charge their cars at night, when there is no solar. It’s by far the most convenient time, and also the cheapest time on the current grid. Even in the future, when noon is the cheapest time, night will still be the most convenient, as the car is always home and you’re asleep. There are smart controllers sold which monitor the solar power and tell the car to charge when there is solar surplus, and people use them, but there is an issue.

Today, when I buy electricity, I might pay 53 cents for an on-peak kWh. But I pay only 18 cents for the energy, and 35 cents for the delivery by PG&E, the utility. But it’s likely my neighbors would be very happy to pay me 25 cents for my power, plus some reasonable fee like 5 cents for use of the wires up and down the pole. They pay 30 cents instead of 53, and I receive 25 instead of 6. Not as good as NEM2 but a lot better than NEM3.

 

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