NEM 3.0 in California:
What every PG&E customer needs to know.
California’s Net Billing Tariff changed the rules overnight. Your utility company just got a huge advantage. Here’s how to fight back.
cut in solar export credits under NEM 3.0
avg. PG&E rate/kWh in 2026
of new CA solar installs include battery storage
payback for solar + storage under NEM 3.0
ON THIS PAGE
— What is NEM 3.0 —
Your utility company changed the rules.
NEM 3.0, officially the Net Billing Tariff (NBT) is California’s current solar billing policy for PG&E, SCE, and SDG&E customers. It took effect April 15, 2023. The result? When your solar panels produce more electricity than your home uses, PG&E now pays you a fraction of what they charge you for power.
In plain language: they buy cheap, they sell expensive. And they changed the rules without asking you. That’s exactly why we exist.
Important deadline passed: April 15, 2026 was the final date to achieve Permission to Operate under NEM 2.0 grandfathering. All new systems now fall under NEM 3.0. Contact us to understand your current situation and your best path forward.
How we got here
- 1996
- 2017
- Apr 2023
- Mar 2026
NEM 1.0: California launched the country’s first net metering program. Solar owners earned full retail credit for every kWh they sent to the grid. Participation capped at 5% of utility capacity.
NEM 2.0: Cap removed. Any California homeowner could go solar. Minor fees added but export credits stayed near retail rates. Solar installations surged across Northern California.
NEM 3.0: The CPUC slashed export credits by ~75%. Credits dropped from ~$0.30/kWh to ~$0.05–0.08/kWh. The solar-only model was disrupted overnight. Battery storage became essential.
Upheld by courts: The California 1st District Court of Appeal affirmed NEM 3.0. It is settled law. Battery storage now accounts for ~70% of all new solar installs in California.
— NEM 2.0 VS. NEM 3.0 —
What actually changed and what it costs you
One number tells the whole story: the value of electricity you export to the grid dropped by three-quarters. Everything else flows from that single shift.
Full retail credit for your exports
When your panels produced more than you used, PG&E credited you at close to the retail rate. A solar-only system could offset most or all of your bill. Payback period: 6–7 years.
Avoided cost: a fraction of retail
Exported solar is now compensated at wholesale “avoided cost” 75-80% less than what PG&E charges you to buy power back during peak hours. Solar-only payback: 8-10 years.
The key insight: Under NEM 3.0, the electricity you store and use yourself is worth 4 to 6 times more than the electricity you export to the grid. A battery is your best tool for maximizing value; store your solar energy rather than giving it away for a low return.
Other changes under NEM 3.0
- Mandatory TOU enrollment: All NEM 3.0 customers are required to use a Time-of-Use rate plan. Under this structure, electricity costs more during evening peak hours from 4 PM to 9 PM, which is exactly when your solar panels have stopped producing.
- ACC Plus adder: A small additional export credit that decreases 20% per year for PG&E and SCE customers, reaching zero for new applicants after April 2028.
- Annual true-up: Unused export credits no longer pay out as cash. They’re applied to your bill over 12 months, then expire. Oversizing solar is now inefficient.
- New Base Services Charge (March 2026): PG&E added a $24/month fixed charge for most residential customers. Solar + storage helps offset this unavoidable monthly fee.
— Who's affected —
Are you in PG&E territory?
NEM 3.0 applies to PG&E customers across Northern and Central California. If you live in any of Continuum’s service counties, this policy applies to you.
New solar customers
Any system installed after April 14, 2023 in PG&E territory falls under NEM 3.0. Battery storage is essential for all new installs.
NEM 2.0 homeowners
Locked in before April 2023? Your NEM 2.0 rates are protected for 20 years. Adding storage does NOT affect your grandfathered status.
Wildfire zone residents
For residents of the Sierra Foothills, Napa hills, Shasta, and Butte County, solar and storage systems represent both a smart financial investment and a critical safety measure. Equipping your home with battery backup is essential for maintaining power during Public Safety Power Shutoffs (PSPS).
EV homeowners
Driving an EV in PG&E territory? Solar + storage lets you charge on your own midday solar instead of paying peak grid rates. Massive savings.
Note on SMUD customers: The Sacramento Municipal Utility District operates under separate, more favorable net metering rules. The NEM 3.0 regulations described here apply specifically to PG&E customers. Because Continuum installs in both territories, we can tell you exactly where you stand.
— The solution —
Battery storage: the weapon NEM 3.0 created.
NEM 3.0 didn’t kill solar in Northern California. It changed the strategy. The homeowners who understand this are winning. Those who don’t are losing money every single day.
The logic is straightforward: store your solar, don’t sell it cheap.
Solar-only vs. solar + storage
Typical PG&E customer on a 7.2 kW system
payback period
— Exports excess solar at ~$0.06/kWh
— Buys peak power at ~$0.50/kWh
— No protection during PSPS outages
— Limited to daytime bill savings only
shorter payback despite higher upfront cost
How it works in your home
- 6 AM – 8 AM: Home runs on stored battery power. You avoid buying expensive morning grid power.
- 8 AM – 4 PM: Panels produce at full capacity. Home uses solar directly. Excess charges your battery. You keep your power.
- 4 PM – 9 PM: Peak hours. Grid hits $0.40–$0.55/kWh. Your battery discharges. You buy almost nothing from PG&E.
- 9 PM – Midnight: Off-peak rates return. Battery tops off from cheap overnight grid power if needed.
A median customer saves $720 a year with solar alone, but that jumps to $1,649 a year when combining solar with battery storage. That represents a 129% improvement in annual savings. The battery pays for itself over time by storing your clean energy and deploying it to eliminate your most expensive utility purchases every single evening.
How it works in your home
- Tesla Powerwall 3: 13.5 kWh, 11.5 kW output. Fully integrated solar + storage. Ideal for whole-home backup and TOU optimization.
- Enphase IQ Battery 10T: Modular and highly reliable. Pairs perfectly with Enphase microinverter systems. Outstanding monitoring.
- 4Franklin Whole-Home Battery (aPower 2): High-output for large homes or multi-battery setups. Strong performance during extended outages.
— TOU Strategy —
Know when electricity is cheap. Know when it's expensive.
Under NEM 3.0, all PG&E solar customers must be on a Time-of-Use rate plan. The price you pay for electricity varies throughout the day. Understanding this is the key to maximizing your savings.
| TIme Period | Rate tier | Approx. import cost | What to do |
|---|---|---|---|
|
9 PM – 9 AM |
Off-peak |
$0.28–0.34/kWh |
Run dishwasher, laundry, charge EV overnight |
|
9 AM – 4 PM |
Off-peak / mid-peak |
$0.30–0.38/kWh |
Run on solar directly; charge your battery |
|
4 PM – 9 PM |
PEAK |
$0.42–0.55/kWh |
Discharge battery, buy nothing from PG&E |
Rates approximate for PG&E E-TOU-C and similar plans. Actual rates vary by plan and season.
Continuum configures every battery system with smart TOU scheduling built in. Your battery automatically adapts to PG&E’s rate structure without any manual programming on your part. Set it and fight back.
— PSPS & Wildfire Protection —
Your solar does nothing during a power shutoff. Unless you have a battery.
What happens to your solar during a PG&E PSPS?
Here’s what most homeowners don’t know: a standard grid-tied solar system is required by code to shut off during any grid outage including intentional PSPS events to protect utility workers. Even on a bright sunny day, your panels go dark the moment PG&E cuts power to your street.
Without battery storage, you sit in the dark like everyone else. With a properly configured Continuum system, your home automatically islands from the grid and runs on stored solar power, completely independent of whatever PG&E is doing. Keep the lights on. Keep the fridge running. Keep your family safe.
Continuum installs battery systems configured for full islanding capability, automatic transfer switching that disconnects from the grid during an outage and runs your home on battery + solar self-sufficiency within milliseconds.
In 2025, residential battery systems across California provided millions of hours of backup power during outage events. For Northern California homeowners who’ve lived through PSPS events, this resilience value is often the primary reason they choose solar + storage, and it’s a reason that has nothing to do with your electricity bill.
— Already have solar? —
Your next move depends on when you installed.
You're in a powerful position.
Your NEM 2.0 grandfathered rates are locked in for up to 20 years from your Permission to Operate date. Adding battery storage does NOT affect your grandfathered status, this is one of the most important and most misunderstood facts in California solar right now.
By adding storage, you get the best of both worlds: favorable NEM 2.0 export rates AND the ability to eliminate expensive peak-hour purchases. Plus PSPS backup protection you don’t currently have. Call us for a free retrofit assessment.
You're leaving money on the table every day.
If you went solar after April 2023 without a battery, adding storage now is your most impactful financial move. Every day you wait, you’re selling excess midday solar at $0.06/kWh that you could be storing and using at $0.45/kWh value during evening peak hours.
The payback on adding storage to an existing NEM 3.0 solar system is typically strong, especially with available SGIP rebates. Contact us for an analysis specific to your system and bills.
Going solar in 2026 means going solar + storage.
Continuum designs every NEM 3.0 system as an integrated solar and battery system from the ground up. Every system is sized precisely for your home’s energy usage and TOU profile, not oversized for exports that aren’t worth much anyway. We will show you exactly what your system will cost, what you will save, and when you will break even.
— FAQ —
Frequently asked questions
What is NEM 3.0 in California?
NEM 3.0, officially the Net Billing Tariff (NBT), is California’s current policy governing how homeowners with solar panels are compensated for energy they export to the grid. It applies to PG&E, SCE, and SDG&E customers. Under NEM 3.0, export credits dropped roughly 75% compared to NEM 2.0, from roughly $0.30/kWh to $0.05 to $0.08/kWh. The policy took effect April 15, 2023, and was upheld by California courts in March 2026.
Does NEM 3.0 apply to SMUD customers in Sacramento?
No. NEM 3.0 applies only to PG&E, SCE, and SDG&E customers, while Sacramento Municipal Utility District customers operate under a separate and currently more favorable net metering program. Since Continuum installs in both territories, please call us so we can clarify exactly which rules apply to your address.
Can I add a battery to my existing NEM 2.0 solar system?
Yes, and adding a battery will not affect your NEM 2.0 grandfathered status. This is one of the most important things to understand right now. You keep your favorable export rates while gaining all the benefits of battery storage: peak-hour bill avoidance, PSPS backup protection, and SGIP rebate eligibility. Call us for a free retrofit assessment, as your existing inverter may already be compatible.
Is solar still worth it in Northern California under NEM 3.0?
Yes, absolutely. However, the strategy has changed. Solar-only systems still make economic sense with an 8 to 10 year payback, given PG&E’s high rates. Solar and storage systems perform better, offering a shorter payback and dramatically higher savings, because they eliminate your most expensive electricity purchases. When you add the wildfire and PSPS resilience factor, solar and storage becomes one of the most defensible investments a Northern California homeowner can make.
Will my solar panels work during a PG&E PSPS outage?
Standard grid-tied solar systems cannot provide power during an outage without a battery. By code, these systems are required to shut off during grid outages, including PSPS events, to protect utility workers, meaning your panels go dark even on sunny days. Battery storage changes this completely. A properly configured Continuum system will island from the grid during an outage and run your home on stored solar power for hours or days, completely independent of PG&E.
How much does a solar + battery system cost in Northern California?
Solar panels alone cost approximately $2.60 to $3.20 per watt installed, which amounts to $18,000 to $22,000 for a 7 kW system. Battery storage adds $10,000 to $18,000 for a single Powerwall 3 or equivalent unit. SGIP rebates can reduce battery costs significantly. Continuum provides free, detailed quotes showing your net cost after all available incentives. Please call us or book online to receive yours.
Which counties in Northern California does Continuum serve?
Continuum serves Sacramento, Placer, El Dorado, Yuba, Sutter, Shasta, Solano, Amador, Napa, Butte, San Joaquin, and Fresno Counties. Call 916-550-0358 to confirm availability at your address.