NEM 3.0 in California: why solar-only systems need a battery

What NEM 3.0 changed

Under California’s earlier net metering, solar you exported to the grid was credited at close to the retail rate — so a solar-only system that sent power back during the day was a straightforward win. NEM 3.0 (net billing) changed that: exported energy is now credited at a much lower value, and the gap between what you’re paid to export and what you pay to buy is large.

The result is that the most valuable kilowatt-hour is no longer one you export — it’s one you use yourself.

Why a battery is now the key

A battery lets you store your midday solar production and use it in the evening — exactly when grid electricity is most expensive and your panels have stopped producing. Instead of exporting cheap and buying back expensive, you shift your own clean power to when it’s worth the most.

That’s why, under NEM 3.0, we design most California systems as solar-plus-storage. A solar-only system still works, but it leaves a large share of its potential value on the table.

An important exception: municipal utilities

NEM 3.0 applies to California’s investor-owned utilities. If you’re served by a municipal utility — like LADWP in much of Los Angeles — those rules may not apply, and your net-metering picture can look quite different. The first step is always confirming which utility serves your address, because it changes the entire design.