An appeals court upheld California’s NEM 3.0 laws against a lawsuit, reinforcing the net metering rules established by the California Public Utilities Commission (CPUC). These rules, effective from April 15, reduce credits for new solar panel users for energy exported back to the grid. The court found no obligation for the CPUC to identify the best solution, only to adhere to the law. Environmental groups argued that the California NEM 3.0 laws overlooks broader benefits of rooftop solar, such as reducing greenhouse gas emissions and improving resilience to power outages. However, the court limited its consideration to economic benefits to the grid.
The NEM 3.0 policy significantly slashes customer credits for electricity generated on rooftops and sold back to the grid, by up to 80%. Critics claim this hampers the expansion of rooftop solar in California and has led to job losses in the solar industry. Supporters argue that the new incentive structure aligns better with those of the state’s publicly owned utilities and is necessary for fair pricing.
In response to the policy, the CPUC adopted a draft decision to revise the net energy metering tariff, aiming to align it with the electric grid’s conditions and incentivize the adoption of combined solar and storage systems. This tariff applies to new residential solar and storage customers, replacing the current time-of-use rates with a structure that varies according to grid needs. In May 2023, several environmental groups sought a review of the policy in the California Court of Appeal, emphasizing the ignored benefits of rooftop solar and arguing against the changes to the tariff structure.
