Still on NEM 2.0? What Adding a Battery or More Panels Does to Your SDG&E Plan

If your solar went in before April 2023, you’re probably on SDG&E’s legacy NEM 2.0 plan, and it’s worth protecting. Here’s what you can add, what could cost you the plan, and what happens when the home sells or the 20 years run out.

https://www.youtube.com/watch?v=cHv1Wxp0qv0

Key takeaways

• NEM 2.0 lasts 20 years from the date your system was interconnected. When the term ends, the account moves to the solar tariff in effect at that time, which today is SDG&E’s Solar Billing Plan.
• Adding a battery doesn’t change your NEM 2.0 legacy period. Larger batteries come with metering or control requirements so the utility can tell solar exports from battery exports.
• You can add panels up to the greater of 10 percent of your original system size or 1 kW. Going past that risks moving the account to the Solar Billing Plan.
• Selling the home doesn’t end NEM 2.0. The remaining years stay with the meter and pass to the buyer.
• At your annual true-up, extra solar is paid at SDG&E’s net surplus compensation rate, which was about 2.3 cents per kWh in November 2026.

Frequently asked questions

Can I add a battery to my NEM 2.0 solar system?

Yes. Adding storage doesn’t affect your NEM 2.0 legacy period. Batteries over 10 kW usually need a separate solar meter, a non-export setup or a certified control mode, and battery exports charged from the grid don’t earn net metering credit.

How many panels can I add without losing NEM 2.0?

The limit is the greater of 10 percent of your original system’s capacity or 1 kW, and the system still can’t exceed your home’s annual usage. On a 6 kW system, that’s 1 kW, or about two to three modern panels.

What happens to NEM 2.0 when I sell my house?

It stays with the meter. The buyer takes over the remaining years of the original 20-year term. A 2025 bill, AB 942, would have ended legacy net metering at sale, but that language was removed in committee and the bill didn’t pass.

What happens when my 20 years on NEM 2.0 end?

The account moves to the tariff in effect at that time. Today that’s SDG&E’s Solar Billing Plan, where exported solar earns much less, so a battery becomes more valuable as the end date approaches.

What is SDG&E’s net surplus compensation rate?

It’s what SDG&E pays for extra solar left over at your annual true-up. The rate is set monthly from wholesale prices and was $0.02256 per kWh in November 2026, after ranging from about 1.2 to 2.9 cents over the prior year.

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If you went solar in San Diego before mid-April 2023, you’re likely on NEM 2.0, the legacy net metering plan that credits exported solar at close to the retail price of the time period you export in. New customers can’t get it anymore. Since 2023, new systems go on the Solar Billing Plan, where exports earn a fraction of that.

That makes NEM 2.0 worth protecting. It also raises fair questions when you’re thinking about a battery, a few more panels, or selling the house. Here’s how the rules work.

How long NEM 2.0 lasts

Under the CPUC’s net metering rules, NEM 2.0 customers can stay on the tariff for 20 years from the date they interconnected. In practice that’s usually your Permission to Operate date. A system turned on in 2018 keeps NEM 2.0 until 2038.

NEM 2.0 also requires a time-of-use rate plan, and you pay a few cents per kWh in non-bypassable charges on the power you pull from the grid. The enrollment window is closed: applications had to be in by April 14, 2023.

Adding a battery

This is the most common question, and the answer is reassuring. Adding battery storage doesn’t affect your NEM 2.0 legacy period. The CPUC’s 2022 decision on the new solar tariff kept that protection, and the utilities’ implementing filings spell it out.

There are technical conditions, and your installer handles them in the interconnection application:

• Batteries of 10 kW or less generally don’t need an extra meter.
• Larger batteries need a separate solar meter, a non-export configuration, or a certified control mode that keeps the battery from exporting power it took from the grid.
• Battery exports charged from the grid don’t earn net metering credit. Exports from solar still do.

What does a battery do for a NEM 2.0 home? Less than it does for a Solar Billing Plan home, but still something. On a time-of-use plan, midday solar is credited at the cheaper midday price, while power you use from 4 to 9 p.m. is billed at the on-peak price. A battery that stores midday solar for the evening captures that spread. The bigger reason most NEM 2.0 owners add one is backup: grid-tied panels shut off in an outage, and a battery is what keeps the house running. We explain why in does solar work when the power goes out?

Adding more panels

You can grow a NEM 2.0 system, but only a little. The limit is the greater of 10 percent of your original system’s capacity or 1 kW, and the system still can’t be larger than your home’s annual usage.

Original system	Allowed addition
5 kW	1 kW
8 kW	1 kW
12 kW	1.2 kW

Go past that limit and you risk moving the account to the Solar Billing Plan. San Diego Community Power, which supplies power to many SDG&E customers, states it plainly: accounts transition to the Solar Billing Plan if system capacity increases by more than 10 percent or 1 kW. Some setups meter new panels separately under the newer tariff instead, so ask exactly how SDG&E will treat your addition before you sign anything.

If your household’s usage has grown with an EV, a pool pump or a heat pump, a battery is often the better first move than more panels, because it protects your plan and makes better use of the solar you already have.

Selling the home

Selling doesn’t end NEM 2.0. The legacy status and the remaining years stay with the meter, so the buyer inherits whatever is left of the original 20-year term. SDG&E’s Solar Billing Plan page notes that for new occupants, the legacy period began when the panels were first installed and interconnected.

There was a real scare in 2025. As introduced, a bill called AB 942 would have ended legacy net metering when a home sold. The Senate Energy Committee removed that language in July 2025, according to the committee’s analysis, and the bill didn’t pass. Rules can change, but as of today a NEM 2.0 home carries its plan to the next owner, which is worth mentioning in a listing.

When the 20 years run out

At the end of the term, the account moves to whatever solar tariff is in effect, which today is the Solar Billing Plan. Under that plan, exports earn far less than under NEM 2.0, so the value of storing your own solar goes up. SDG&E’s NEM 2.0 era began in 2016, so the earliest terms end around 2036. That sounds far off, but a battery you add now will still be working when your date arrives, and it’ll matter more on the day you switch.

How your true-up works

NEM 2.0 bills on a 12-month cycle. Charges and credits roll forward month to month, and at your annual true-up you pay what you owe. If you produced more than you used over the year, SDG&E pays for the surplus at its net surplus compensation rate, which it publishes on its true-up rate page. The rate is based on wholesale prices and was $0.02256 per kWh in November 2026, after ranging from about 1.2 to 2.9 cents over the prior year.

That low payout is why oversizing a NEM 2.0 system doesn’t pay. If you’re a San Diego Community Power or Clean Energy Alliance customer, the generation side of your surplus payment comes from your community choice provider rather than SDG&E. Our guide to SDG&E net metering in 2026 covers how NEM 2.0 and the Solar Billing Plan compare.

Protect the plan you have

If you’re on NEM 2.0 and thinking about a battery or a few more panels, Stellar Solar can check your original system size, your interconnection date and your usage, and design an addition that keeps your plan intact. Stellar Solar has been San Diego’s trusted solar installer since 1998, A+ rated with the BBB and a repeat winner of San Diego’s Best Solar in the Union-Tribune Readers Poll. Call 866.787.6527 for a free evaluation, or get your free quote here.

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Does Solar Work When the Power Goes Out? Why Panels Shut Off and What a Battery Changes

It’s the most common surprise for new solar owners in San Diego: the grid goes down on a sunny afternoon, and the house goes dark anyway. Here is why that happens, and what has to be added for solar to keep your home running.

https://www.youtube.com/watch?v=HnQt502CGRA

Key takeaways

• A grid-tied solar system without a battery shuts off during an outage, even on a sunny day. It’s designed and required to, to protect line crews.
• Under IEEE 1547, a grid-tied system has to stop energizing the grid within two seconds of an outage. This is called anti-islanding.
• A battery with a backup switch isolates your home from the grid, so the solar can keep running and recharging the battery.
• A Powerwall 3 stores 13.5 kWh, delivers up to 11.5 kW continuously and accepts up to 20 kW of panels through its built-in solar inverter.
• A battery can usually be added to existing solar, and on normal days it covers SDG&E’s expensive 4 to 9 p.m. hours.

Frequently asked questions

Do solar panels work during a power outage?

Not on their own. A standard grid-tied system shuts down when the grid does. A system with a battery and a backup switch keeps powering the home, and it can keep doing it for days as long as the sun recharges the battery.

Why does my solar shut off when the power goes out?

It’s a safety requirement called anti-islanding. Utility crews expect de-energized lines, so the IEEE 1547 standard requires a grid-tied system to stop energizing the grid within two seconds of an outage, and inverters are tested and certified to that behavior under UL 1741.

Can I add a battery to my existing solar system?

Usually, yes. The design depends on your current inverter and electrical panel, so that’s the first thing an installer should look at.

Will solar recharge my battery during an outage?

Yes, with a battery like the Powerwall 3, which has a built-in solar inverter. Once the backup switch isolates your home, the panels power the house and refill the battery during the day. Tesla says that if the battery runs down below about 10 percent, it goes into standby and tries to restart from solar each hour during the day.

Should I choose whole-home or partial backup?

Whole-home backup keeps every circuit on the battery and is the most seamless. Partial backup moves essential circuits to a backup panel, so the battery lasts longer. The right choice depends on how long outages run in your area and what you can’t do without.

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The panels are on the roof. The sun is out. SDG&E has a Public Safety Power Shutoff in effect, or a transformer blew down the street. And your home, with its solar system producing at full output, has no power.

Nothing is broken. That’s how a standard grid-tied solar system is designed to behave, and it’s required to.

The short answer

A typical solar system without a battery does not power your home during an outage. A solar system with a battery and a backup switch does, and it can keep doing it for days as long as the sun keeps recharging the battery. That pairing is what people mean by solar battery backup, or blackout protection, in San Diego.

Why grid-tied solar shuts off

Most San Diego solar systems are grid-tied: the panels feed an inverter, the inverter feeds your home, and anything extra flows out to SDG&E’s lines. When the grid goes down, that last part becomes a hazard. Utility crews working to restore power expect de-energized lines. A solar system pushing electricity back onto those lines could injure them.

So the industry standards that govern inverters require them to detect an outage and stop exporting quickly. Under IEEE 1547, a grid-tied system has to cease energizing the grid within two seconds of an outage. Inverters are tested and certified to that behavior under UL 1741. This protection is called anti-islanding, and it’s the reason your panels go quiet the moment the grid does, no matter how sunny it is.

What a battery adds

A battery fixes the problem by changing what the system is connected to. With a Tesla Powerwall 3, a Backup Switch installed at the meter disconnects your home from SDG&E’s lines automatically when the grid fails. Once your home is physically isolated, there’s no risk to line crews, and your solar system is allowed to keep running inside that small, self-contained “island.”

From there, the pieces work together:

• The battery runs the house. Each Powerwall 3 stores 13.5 kWh and delivers up to 11.5 kW continuously.
• The panels recharge the battery. The Powerwall 3 has a built-in solar inverter that accepts up to 20 kW of panels, according to Tesla’s datasheet, so daytime production goes into the battery and your home.
• The system manages itself. Tesla says that when the battery is nearly full during an outage, the Powerwall tells the solar inverter to throttle back or shut off, since there’s nowhere for extra power to go. If the battery runs down below about 10 percent, it goes into standby and tries to restart from solar each hour during the day.

The U.S. Department of Energy puts it simply: for solar to keep running in an outage, it needs a properly configured inverter and a storage system. Its solar and resilience basics page explains the concept.

Whole-home backup or partial backup

When you add a battery, you also decide what it powers:

• Whole-home backup keeps every circuit on the battery. It’s the most seamless option, and Tesla says a Powerwall 3 system can provide whole-home backup to most homes. Large loads like central air, pool pumps and EV charging will drain the battery faster.
• Partial backup moves essential circuits (refrigerator, lights, internet, medical devices, a few outlets) to a backup panel. The battery lasts longer because it isn’t feeding everything.

Neither is better in general. The right answer depends on how long outages run in your area and what you can’t do without.

What about the solar you already have?

If you have solar and no battery, you’re not starting over. A battery can usually be added to an existing system, but the design depends on your current inverter and electrical panel, so that’s the first thing an installer should look at. Under SDG&E’s current solar billing rules, a battery also earns its keep on normal days by covering the expensive 4 to 9 p.m. hours, so the added backup comes with bill savings attached.

What a multi-day shutoff looks like with solar and a battery

Here is how a well-designed system behaves through a two-day Public Safety Power Shutoff:

1. Before: Tesla’s Storm Watch sees the red flag warning and charges the battery to full.
2. Shutoff begins: the Backup Switch disconnects the home and the battery takes over automatically.
3. First evening and night: the battery runs the house.
4. Next day: the panels power the home and refill the battery.
5. Restoration: when SDG&E re-energizes the line, the system reconnects to the grid automatically.

SDG&E says shutoffs can last from several hours to multiple days, which is why the daytime recharge matters as much as the battery itself.

Make your solar work when you need it most

If your panels go dark when the grid does, a battery is the missing piece. Stellar Solar can look at your existing system, or design a new one, so your home keeps running through the next outage. Stellar Solar has been San Diego’s trusted solar installer since 1998, A+ rated with the BBB and a repeat winner of San Diego’s Best Solar in the Union-Tribune Readers Poll. Call 866.787.6527 for a free evaluation, or get your free quote here.

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