Solar still makes sense under Solar Billing (NEM 3)

by Sandipan Bhanot, Chairman and CEO of Staten Solar

Solar Billing plan (aka NEM 3.0) replaced the NEM2.0 policy in April 2023 across major California Utilities such as PG&E, SCE and SDG&E. This policy significantly reduced the value of the exported energy to the grid hence reducing the savings and hence making the customer payback longer. [Download our free report here on comparison of NEM2 vs. NEM3 credit and payback computation.]

As NEM3 made the projects less attractive, the demand for solar took a hit. The residential solar market was especially hard hit as evidenced by the decimation of various firms catering to this sector. Many interested people have probably assumed that investment in a solar project no longer makes economic sense.

But this assumption is not accurate.

Since the NEM3 decision last year, many forces have come into being that are counterbalancing the NEM3 impact.

• The Inflation Reduction Act passed in Nov 2022 has clarified its guidelines and provides for added tax benefits – which return up to 20% of the project cost to the owner IN ADDITION TO ALL OTHER BENEFITS/INCENTIVES:

o   10% ITC adder for Energy communities – applies to wide swath of population

o   10% ITC adder for using Domestic Content – achievable for project getting signed now

• ·Utilities rates have increased quite drastically in the last year – last one on July 1. 2024 – making the savings calculations more attractive

• Adding storage can help minimize exports and help retain energy to avoid these high utility rates. And storage prices have been falling making the investment much more affordable. Needless to mention, the tax incentives mentioned above apply to Storage too.

• We see that under some circumstances, the project economics become MORE favorable than under the landscape of NEM2 policy!

Of course, the situation is going to be different for different customers depending on geography, utility, installation configuration, rate schedule, and your specific tax situation.

In this rapidly changing solar industry, it's important to remember that strong and reliable companies are still around and thriving to take care of our esteemed customers.

Talk to Staten by sending a two line email to [email protected] or any other knowledgeable installer today for a free consultation to help evaluate your specific situation.

Best wishes Finding your Path to Solar!

P.S. In this rapidly changing solar industry, it's important to remember that strong and reliable companies are still around and thriving to take care of our esteemed customers.