Toolkit: Net Energy Metering (NEM) 3.0

Last updated June 24th, 2021
Background

The California Public Utilities Commission (CPUC), the entity responsible for regulating the investor-owned electric and gas utilities in California, has launched a proceeding to re-evaluate the current net energy metering (NEM) program and decide upon a new NEM program, to be established as NEM 3.0.

Simply put, NEM is the program that allows rooftop solar customers to be compensated for the excess electricity they send back to the power grid.  NEM, paired with solar financing and ratepayer funded incentives, has allowed solar to become increasingly accessible to low-and-moderate income families across California.

California Investor Owned Utilities (IOUs), Pacific Gas and Electric, San Diego Gas & Electric and Southern California Edison have submitted a joint proposal that calls for drastic changes to NEM that would make solar energy more expensive, increase the amount of time it takes for customers to pay off the system and ultimately has the potential to eliminate the California solar market.  For a deeper dive on NEM in California, please visit our blog on the history of NEM.

Party Proposals

A total of 17 party proposals were submitted to the CPUC for consideration early this year.  Each proposal is required to demonstrate the cost effectiveness of their proposal as well as adhere to the guiding principles put forth by the CPUC.  These guiding principles include:

  • Ensuring equity among customers
  • Enhancing consumer protection measures
  • Maximizing the value of customer-sited renewable generation to all customers
  • Ensuring transparency to all customers 
  • Coordination with current California energy policies including Senate Bill 100 

Proposals were submitted by:

  • The California IOUs
  • California Solar and Storage Association
  • Sierra Club
  • Foundation Wind Power
  • CAlifornians for Renewable Energy
  • Coalition for Community Solar Access
  • California Wind Energy Association
  • California Energy Storage Alliance
  • Vote Solar, Sierra Club and GRID Alternatives
  • Small Business Utility Advocates
  • Solar Energy Industries Association and Vote Solar
  • Natural Resources Defense Council
  • The Utility Reform Network
  • Ivy Energy
  • Protect our Communities Foundation
  • Cal Advocates
  • Clean Coalition
Timeline

A final decision is expected early next year, however the current timeline is subject to change.  Below is the expected schedule for the remainder of the year.

Opening Testimony
June 18, 2021
Rebuttal Testimony
July 16, 2021
Evidentiary Hearing
July 26 - August 6, 2021
Completion of Settlement Talks
August 27, 2021
Opening Briefs
August 27, 2021
Reply Briefs
September 10, 2021
Proposed Decision
No later than 90 days after Reply Briefs
(December 9, 2021)
Commision Decision
No later than 30 after the Proposed Decision
(January 8, 2021)
What Has Transpired

On Thursday June 24, the CPUC voted to approve major updates to the calculator that will be used to evaluate every NEM proposal, called the Avoided Cost Calculator.  These major updates undercut the value of solar by two-thirds compared to the 2020 version of the calculator.  The calculator was developed by the E3 consulting firm which is the same consulting firm used by utilities that regularly puts out materials that are biased against distributed generation.

The commissioners voted unanimously to approve the updates despite the fact that the calculator uses an entirely new and untested model for predicting how wholesale energy pricing will behave in the future.  These updates were labeled as minor, and as such did not go through a robust public process where stakeholders can engage and vet the new model.  Over 7,000 comments were made by environmental advocates, homeowners, community groups and climate justice organizations urging the commissioners to not vote to make the updates official until after the new model has been put through a public process.

Because of this decision, it will be even harder to secure a strong NEM 3, which is needed to help stop climate injustices and the climate crisis.  This is why your voice is needed now more than ever!

Community Voices
Ways to Get Involved
  1. Sign the Save California Solar petition.
  2. Sign onto our coalition’s NEM letter, urging the CPUC and Governor Newsom to increase solar access while prioritizing equity.
  3. Attend our monthly Save California Solar coalition meetings
  4. Call on your elected officials to advocate for a strong NEM! Rooftop solar is crucial in meeting local climate action plans, creating local jobs and addressing the climate crisis by transitioning away from fossil fuels.
  5. Call into the CPUC meetings to make non-agenda public comments. Commission meeting dates can be found on the public calendar. The meetings are available to watch via webcast at www.adminmonitor.com/ca/cpuc however in order to make public comments you must call in.
  6. Call-in directions and talking points:  

If you would like to speak during the public comment period at the start of the meeting, please participate by phone and call in by 10 a.m. and you will be able to make your comment. Comments cannot not exceed 2 minutes.

1-800-857-1917, passcode: 9899501 (to make a public comment during the public comment period, press *1)

  • State your name and organization or location.  
  • Indicate you are calling in to urge the CPUC to keep solar growing in California by creating a strong NEM 3.0
  • Pick from any of the points below and personalize them:
  1. State your name and organization or location.  
  2. Indicate you are calling in to urge the CPUC to keep solar growing in California by creating a strong NEM 3.0
  3. Pick from any of the points below and personalize them:
  • The state has said that we need to triple the amount of rooftop solar we have in order to meet our climate goals.  This simply will not happen if the economics of going solar are cut in half and payback periods increase to well over the warranty for systems expires, as proposed in the joint IOU NEM proposal.
  • California has ambitious climate goals that we will not meet with utility scale solar and wind alone, we need to expand solar access to disadvantaged communities in order to not only meet our climate goals, but help alleviate the burden of skyrocketing energy costs.
  • California will continue to suffer from power outages if we don't rapidly deploy more solar and battery storage.
  • Local distributed solar saves every ratepayer money.  Rooftop solar reduces the cost of maintaining long distance power lines as well as wildfire costs associated with long distance power lines.  The LA Times reported that rooftop solar could save U.S. ratepayers $473 billion and not installing rooftop solar could cost ratepayers $385 billion dollars.
  • We are in a climate crisis and should be doing everything we can to expand rooftop solar access and transition away from dirty energy, which is contributing to climate injustices and accelerating the climate crisis.
  • Please don’t take away opportunities for LMI ratepayers who are finally able to afford solar. Rooftop solar protects families who are struggling to pay skyrocketing electricity prices.
Click the item below to view or download
350 Bay Area Action
350 Butte County
350 Silicon Valley
350 Ventura County Climate Hub
A Stellar Co
Active San Gabriel Valley
Aloha Solar Power
American Federation of Teachers
Association of California School Administrators
Baker Electric
Baker Electric Home Energy
BikeSD
Bquest Foundation
BTU
Business For Good San Diego
California Alliance for Community Energy
California Democratic Renters Council
California Interfaith Power and Light
California Public Interest Research Group
California Solar and Storage Association
California Young Democrats
CCAEJ
Center for Community Energy
Center for Sustainable Energy
Chico 350
Citizens Climate Lobby
Citizens Franchise Alliance
Clean Coalition
Clean Earth for Kids
Clean Power Campaign
Clear Spot Energy
Climate Action Campaign
Climate Hawks Vote
Conejo 350
Conejo Climate Coalition
Corona Enterprises
Defenders of Wildlife
Del Paso Heights Growers Alliance
EAH Housing
Earth Day LA
Earth Justice
Eco San Diego
EGW
Environment California
Fallbrook Climate Action Team
Feminists in Action
Food and Water Watch
Fossil Free California
Glendale Environmental Coalition
Green New Deal UCSD
Green Power Romero Institute
Grid Alternatives
Hammond Climate Solutions
HES Solar
Humbolt Young Democrats
I Am Green And So Are You
Indivisible
Indivisible Alta Pasadena
Indivisible Beach Cities
Indivisible CA 33
Indivisible CA 37
Indivisible CA 43
Indivisible California Green Team
Indivisible Los Gatos
Indivisible Marin
Indivisible Ross Valley
Indivisible Sacramento
Indivisible San Pedro
Indivisible South Bay Los Angeles
Indivisible Stanislaus
Indivisible Ventura
Indivisible Yolo
Livermore Indivisible
Local Clean Energy Alliance
Long Beach Alliance for Clean Energy
Morongo Basin Conservation Association
Mujeres De La Tierra
Mystery Org
National Parks Conservation Association
Normal Heights Indivisible
North County Climate Change Alliance
Northern California Land Trust
Otherlab
People Power Solar Cooperative
Progressive Caucus California Democratic Party
Progressive Democrats of America
Redwood Energy
Romero Institute
Rooted in Resistance
San Diego 350
San Diego Climate Hub
San Diego Coast Keeper
San Diego County Democrats for Environmental Action
San Diego Energy District
San Diego Green Building Council
San Diego Green New Deal
San Francisco Bay Area Extinction Rebellion
San Francisco League of Conservation Voters
Santa Cruz Climate Action Network
Santa Cruz Indivisible
School Energy Coalition
Sierra Club
Silicon Valley Leadership Group
SoCal 350 Climate Action
Social Eco Education
Solar Rights Alliance
South Bay 350 Los Angeles
SPUR
Sullivan Solar Power
Sunrise Movement Redding
Sustainable Marin
Sustainable Mill Valley
Sustainable Urban Network
The Climate Center
The Climate Reality Project
The Environmental Justice Coalition for Water
The Resistance Northridge Indivisible
The Rural Caucus California Democratic Party
University Professional and Technical Employees
Uptown Tavern
Vote Solar
TOP