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CPUC NEM 3.0 discussion
- Thread starter jjrandorin
- Start date
Seems like a good idea for you to try and get your project in under NEM 2.0
Here's the present reality: Local installers are charging >$5/watt right now, plus $15K for a Powerwall. Tesla is charging about $2.90/watt, and <$10K for a Powerwall. The overall price difference for something in the ~6kW range is close to $15K, even after the federal tax credit.
The local guys should be able to git'r'done before the deadline. Assume Tesla cannot.
So: Is NEM2.0 worth spending an additional $15K up front? How many years of NEM 2.0 will it take to recoup that investment? A bird in the hand....
all you have to do is get paperwork filed. Install can be up to 3 years later
The installer is typically the person who does the paperwork, and they won't do this until a contract is signed. Or are you suggesting I do everything on my own?
@arnolddeleon and @getakey have a point... you could procure your own solar, and get a NEM 2 form submitted to get a place in line. Skip the ESS for now, the NEM 3.0 language is supposed to allow NEM 2.0 solar customers the ability to add ESS without re-setting their NEM.
I know you're not in PG&E land, but for someone in NorCal it's pretty straightforward to submit an application for 79-1193-02. Should be the same in your neck of the woods.
He paid them $250 already, they just haven't responded to him or put in a request to hold the PTO.
We can always cancel and get the $250 back.
For a variety of reasons I won't get into, this isn't really a project I'm capable of self-managing. So I ask again: Is NEM 2.0 (local installer) worth an additonal ~$15K of up-front costs vs. NEM 3.0 (Tesla)?
Did you get a lot more quotes? Try energysage at all?
I've gone over my situation before, but I didn't go Tesla, my install was like $2.55/W or so. I chose all my own components and pricing wasn't anymore than Tesla (which was like $2.50 or so at the time). This was in 2021 of course and I'm sure prices are higher, but installers have an incentive to lock you in and do things right or simply, no business.
Not to say you won't get grandfathered in with Tesla even now and you have a month and a couple weeks, but there probably is still time even with Tesla and we won't know till after mid April if Tesla pulls through.
I still see quotes on reddit that are closer to $3-$3.50 or so now, but whenever I see someone post some high price here, it's more of a self defeatist attitude and pure laziness to consider anything else I feel. Of course, this isn't true in every area, but definitely not in CA.
If you don't get NEM2.0, and have no plans to install batteries on 3.0, NEM3.0 will be more like a $10/W install so if $5/W sounds bad to you, enjoy $10/W if you even get solar at all (most won't and I'd bet you won't neither).
1 battery is a waste of $$/time IMO. There are fixed cost with installing even a small battery, but that's my personal opinion. Some installers will also mark up just 1 battery due to more time needed, need to pull separate loads, low profits vs. basic, solar only installers.
As someone else stated, get the solar now, ignore storage if you don't want to spend the $$ yet.
I'm asking you to submit your own PTO placeholder instead of going through an installer right now. The installers just submit on your behalf. You don't need an installer to reserve your place in line.
Once the "tulip mania" passes you can find an installer that picks up your project that hopefully is not $6/watt.
I didn't know about this and are you sure? I thought you needed the line diagram, the installer picked out, etc etc etc from what I read earlier.
andy isn't a DIYer.
Here's that reddit thread from 5 days ago:
Ah I see what you mean... in SCE he'd need it "deemed valid" which will require a 11x17 plan-set that is AHJ approved.
RIP, looks like Andy needs to either get NEM 3.0 after the tulips wilt, or as he says move to Texas. I mean, my PG&E bill in January (only natural gas and the electric NBCs) was $600. Households near me with no solar were paying almost $1,000. And apparently this is "fine and expected" in California.
$1,000 was the edit:
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The answer is it is going to depend on your specific system, energy use, and energy usage pattern. The question might even be is solar worth it at all in either case but again depends on specifics and your motivation to get solar.
In my particular case Tesla installed the system in 2021 at $2.01/W before federal tax incentives. I also had 2 PWs installed at the same time which essentially doubled the price of the system. My first full year after PTO I paid SCE $2550 less than the prior year. My savings would not have changed much without PWs since I am a net producer. Given those savings and the federal tax credit it would take me 5 years to "break even" on a solar only install and 10 years for my solar + PW install. If I had to pay twice or three times that amount for solar only obviously that 5 year pay back period is going to jump to 10 to 15 years.
What happens on NEM 3.0 is even harder to gauge as your payback period will be highly dependent on how much of your solar you can self consume. Batteries do help but they already have a longer pay back period. From my first year data I reduced my gross grid consumption by almost 75%, so even if I got paid $0 for energy sent back to the grid my 10 year pay back period would only extend to 13 years.
Yes prices will certainly drop for solar installs after NEM 3.0 but it probably won't be quick given the backlogs and there is only so low they can go given the labor intensive nature of the installs. Solar installation companies will consolidate or go out of business which will be an upward pricing pressure. Tesla somehow has made it work for now but you also get Tesla's lackluster support.
Here is what our utility PG&E says:
The NEM2 program will be closed to new applicants starting 04/15/2023. After which, new customers will be interconnected under the successor tariff. To qualify for NEM2 please submit the following by 11:59 PM PST on 04/14/2023*:
*NEM2 Aggregation and Virtual NEM2 programs will remain open until further notice.
*After this time, In-progress but unsubmitted Rule 21 generation applications will be cancelled (excluding NEM Aggregation, Virtual NEM and ZNE generation applications).
* PG&E will make an exception for new construction projects unable to submit a completed application by the sunset date. If the load application is submitted by the NEM2 Sunset date, the project will be eligible for NEM2, provided the site is energized under the same Service Point Notification. This refers to the “Project Number” or “Notification Number”. To retain this eligibility, final electrical clearance must be granted by 04/15/2026.
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The NEM2 program will be closed to new applicants starting 04/15/2023. After which, new customers will be interconnected under the successor tariff. To qualify for NEM2 please submit the following by 11:59 PM PST on 04/14/2023*:
- Completed application, free of major deficiencies (e.g. no blanks, incomplete/inaccurate document, changes requiring resubmission per Rule 21)
- A single-line diagram
- A signed CSLB Disclosure and Solar Consumer Protection Guide (For residential, non-self install only)
- A signed Agreement and Authorization Form (For systems 30kW or less)
*NEM2 Aggregation and Virtual NEM2 programs will remain open until further notice.
*After this time, In-progress but unsubmitted Rule 21 generation applications will be cancelled (excluding NEM Aggregation, Virtual NEM and ZNE generation applications).
* PG&E will make an exception for new construction projects unable to submit a completed application by the sunset date. If the load application is submitted by the NEM2 Sunset date, the project will be eligible for NEM2, provided the site is energized under the same Service Point Notification. This refers to the “Project Number” or “Notification Number”. To retain this eligibility, final electrical clearance must be granted by 04/15/2026.
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Why would solar prices go up under NEM3? I would think they will come down because less people will buy
In the short term yes, but if smaller solar companies go out of business, only the big fish remain (Tesla) and with less competition, they will increase their price.
Aside from inflation... after NEM 3.0 goes in effect, the smaller solar companies (who don't have the purchasing power to get ESS inventory) simply cannot function. During the previous round of discussions after the NEM 3.0 PD dropped, many CALSSA and SEIA members said that the values the CPUC were using in their ROI/Payback calculations was untenable.
As a refresher, here's the table. The CPUC felt that residential solar could be installed for about $2.60 per watt.
The installers argued that if $2.588 is the average per watt, then some installs would be over $2.60; while others would then logically have to be below $2.60. And there was no way an actual business could deliver solar onto a residential rooftop for such a pittance. Basically if a job were only paying $2.00 per watt, the installer couldn't take the project unless it was Tesla willing to sell at or below cost to drive top-line numbers. As @Vines pointed out, it's expensive to run a construction company in California.
The CPUC responded saying their figures were good, and installers just need to do better to get their costs down.
So to that end, the only viable businesses have to incorporate energy storage solutions. Sunrun, Sunpower, Tesla, Semper, etc are all poised to only install PV+ESS systems in California as the solar-only business model vanishes. (edit: note, new construction has to come with solar, but Sunrun has a lot of those contracts locked up with major developers). Without as much competition, the prices will go up even if the economic terms for the buyer are less attractive with NEM 3.0 policies.
When I purchased my 7 kWp-AC PV system and 3 Powerwalls from Sunrun in 2020, the gross cash I paid was $57,000. That is over $8.00 "per solar watt" when factoring in all the equipment against just the PV. Thankfully there was a large-scale SGIP lol.
When a neighbor tried to get a quote for a similar system from Sunrun a few months ago, it was over $75,000 gross (yes, >$10 per solar watt). I doubt pricing is going to come down from here as the competition and options dry up. Installers need either volume or margin to run a business. With NEM 3.0 policies, business viability for installers will need to come from margin.
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I use this example (the $10/W randomly here) because with the 1:1 net metering turning to 1:0.25 or 1:0.13 (for San Diego which is worst), all your exports during peak is now only worth 25% or 13% of what it used to.
This means from a cost perspective, to try to zero out your bill as everyone banks credits currently (I don't think the numbers work personally under NEM3.0), you will need to generate 4x as much or, in a more realistic case (not many people exports 4x use, you're now paying 4x more for your install since you're now being credited 4x less from the IOU so at the end of each month, will probably pay 4x more than you were under NEM2.0 since you have little/no credits built up.
Maybe a strange way to look at it, but not getting NEM2.0 puts installs in a pretty bad shape credits wise.
I would think with how bad numbers look when this is all said and done, something may change and we may get NEM3.1 or 4.0.
Tesla has left various markets for whatever reasons (there is a thread here, but I don't follow it) I'm also generally in agreement that prices won't go down much. Labor is a huge part of the price and in CA, that's usually not something that goes down much.
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