What changed
California's Net Billing Tariff, often called NEM 3.0, applies to homes that applied to connect solar to the grid on or after April 15, 2023. It replaced the older net metering rules, known as NEM 2.0.
Under the old rules, extra solar power you sent to the grid earned credit close to the retail price of electricity. Under net billing, that exported power earns much less, based on what it's worth to the grid at that hour. Midday exports, when solar is plentiful, are worth the least.
What it means for new solar homes
The value of solar now comes mostly from using your own power instead of buying it from the utility, not from selling it back. That changes how a good system is designed:
- Size the system to your real usage, not to the biggest system your roof can hold.
- Consider a battery. A battery stores extra daytime solar so you can use it during the evening peak, usually 4 to 9 p.m., when utility power costs the most.
- Know your rate plan. Net billing customers are placed on time-of-use rates, so when you use power matters.
Is solar still worth it under NEM 3.0?
For many homes, yes, because utility rates have kept climbing. Over the past 10 years, average residential rates rose about 101% for Edison, 97% for SDG&E and 69% for PG&E, according to the CPUC Public Advocates Office. Every kilowatt-hour you make and use yourself is one you don't buy at those prices.
The only way to know for your home is to run the numbers with your own bill. That's exactly what our free estimate does.
What if I already have solar?
Homes that connected under NEM 2.0 generally keep those rules for 20 years from their original connection date. Adding a battery doesn't normally change that, but expanding the system can. Ask before you make changes.
Common questions
Does NEM 3.0 apply to the bill swap?
Yes. Any new solar system that connects to the grid is on the current net billing rules, whether you buy it or use a PPA. We design the system with those rules in mind.
Do I have to get a battery?
No, but it often improves savings under net billing because it lets you use your own solar power in the evening. We'll show you the numbers with and without one.
Will the rules change again?
They could. Utility rates and solar rules change over time. With the bill swap, your solar rate and its 3.5% yearly increase are fixed in your agreement.
Last updated September 29, 2026. Rates and rules change. Your estimate is based on your own bill.