Solar in San Diego: What to Know Before NEM 3.0

At Stellar Solar, we have worked with a plethora of businesses, nonprofits, utilities, and public sector organizations across the country. Commercial solar has a massive value-add for our customers. Why? Not only do they save serious money - they can also take advantage of a myriad of governmental incentives that saves them money while also being environmentally responsible.  California has always been one of the best states to go solar. Not only is there abundant sunshine, but California has always had many incentives such as rebates and the 26% Investment Tax Credit (ITC). As of April 2022, California leads the nation with over 12.4 MW of solar installed.  However - the California Public Utility Commission (CPUC) has recently proposed big changes to California’s most important solar incentives: net metering. While Governor Gavin Newsom has called rooftop solar ‘essential’ to our state’s future - he fell short of supporting or opposing the NEM 3.0 plan for a monthly solar tax. Needless to say, if these changes are approved, solar could become out of reach for millions of working-class Californians. Net Metering in California Thus Far In 2016, NEM 2.0 was created to supposedly meet the needs of both investor-owned utilities and solar customers.  It did this by providing solar credits at the reduced rate of 2 cents less per kilowatt-hour compared to Net Metering 1.0.  Now, the NEM 3.0 proposal would destroy any financial incentives for solar, and replace them with a solar tax of around $50 per month on Californians who install rooftop solar. Thus, rooftop solar owners would have reduced payments for solar generation and also have to pay a fresh new tax on top of this! Needless to say, this equates to $600 per month, which is insulting to lower-income Californians who wish to go solar.  Details of NEM 3.0 In December 2021, multiple California utilities proposed that the CPUC create NEM 3.0 which would adjust the credit rate by up to 80%. Plus, the retail credit value of about $0.25kWh would shift down to $0.04kWh. Plus, there’s the monthly fee based on solar system size. Want to know the worst part? This proposed monthly charge could reach $800-3400 per month for a 250-kW commercial system. Unsurprisingly, this would decimate the incentives and perks that California’s solar industry has been rightly famous for.  Many solar industry observers have noted that NEM 3.0 could more than double solar project payback periods. Further, EQ Analysts have also noted that NEM 3.0 would lead to a 57-71% reduction in solar savings in the state of California. Most of all, commercial solar systems would face a 40-80% reduction in the value of energy produced by their systems. While utilities are indeed proposing to incentivize home storage systems, there aren’t incentives for commercial solar systems that are paired with energy storage.  Going Solar: Better Now than Later Needless to say, going solar in San Diego (or anywhere in California) is a good idea to do sooner than later. While nothing is set in stone, it is likely that solar customers who go solar under NEM 2.0 will likely be protected by a grandfather clause for an unspecified amount of time. Thus, if you want to remain unaffected by NEM 3.0, now is the time to go solar.  Currently, the CPUC is reopening considerations for NEM 3.0 and the changes are inevitably on the horizon. The current proposal includes a high $0.05/kWh fee on top of this - another factor that hurts the average homeowners who want to go solar.  Keep in mind that regardless of the future of NEM 3.0 there still will be Federal Solar Incentives for future commercial and residential solar customers. Currently, the 26% Federal Solar Tax Credit awards a beautiful tax credit based on the value of the solar installation. This is applicable to both residential and commercial customers. However, the amount will be reduced to 22% in 2023 - another reason to go solar in 2022.  Why Stellar Solar We have assisted homeowners, business owners, non-profits, and many more organizations in California since 1998! Thousands of people (from regular families to large businesses) trust us to get the job done right! Stellar Solar is San Diego's original solar panel installer, and over 15,000 homeowners have selected us for their rooftop and ground mounted solar panel systems across America.  Our reputation as the best in San Diego is validated because we are consistently voted "San Diego's Best Solar Company" in the annual San Diego Union Tribune Readers Poll. Folks are loyal to our brand, and the people of San Diego have voted us the Best in San Diego 9 times in the last 11 years - including once again in 2021! Remember - customer referrals are our #1 source of new business. Needless to say, this is further testament to our positive reputation. But don’t listen to us. Check out our overwhelmingly five star reviews on Yelp. In fact, check out what Stephanie had to say about us this month (July 2022): “Stellar Solar was with us every step of the process when it came to getting solar panels for our house. From the initial step of getting a quote to the final step of turning on our solar panels, Stellar Solar was informative, responsive, and genuine.”  Our founding partners have been designing and installing solar on San Diego homes, businesses, and notable commercial installations like The Salk Institute, Cedars Sinai Hospital, US Foods, and multiple military solar projects. Trust a business with longevity and a 24-year track record that counts!  Solar Power to the People At Stellar Solar, we offer a plethora of solar panel, inverter and battery storage solutions for every type of home or commercial installation budgets. Our home battery storage solutions include Tesla Powerwall, LG, and electric vehicle connectivity solutions. Contact us to schedule a fast, zero-pressure virtual solar consultation today. We will fight against NEM 3.0 together. Thank you California.  

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