PG&E rate hikes improve home solar ROI under NEM 3

PG&E map
PG&E territory in red

As the fight over California’s NEM 3 continues, with one California politician launching an effort to repeal it, PG&E brought value back to solar PV the old fashioned way with a rate hike.

At the start of the year, PG&E started charging 13% more for power to fund undergrounding power lines and other wildfire mitigation efforts – a bump expected to cost an average family another $33 a month.

“But it is likely to be just the beginning of the pain,” reports NBC Los Angeles. “PG&E has filed paperwork with regulators to raise rates another $14 a month, for the average customer, in March, to pay for storm repairs and more wildfire mitigation costs.” 

The California solar industry, which has struggled since the implementation of NEM 3, could benefit. According to Enact Solar, running an analysis on its software, California Residential Solar Customers buying on the NEM 3.0 scheme in PG&E territory are now able to achieve a return on investment (ROI) of 4.8 years in 2024.

Enact system chart
PAYBACK IN YEARS

Similarly, solar-plus-storage customers can now achieve ROI of 5.5 year versus 7.6 years for customers who signed on in 2023. This is based on an 8 kW solar system, with 100% energy offset, priced at $2.90/W, with a storage add-on priced at $13,000 for a 10 kWh battery, fully installed.

“Despite the NEM 3.0 scheme reducing the benefits of going solar in California, our latest study finds that homeowners still stand to benefit from investing in solar-plus-storage systems and unlocking the potential of low-cost energy in 2024 and beyond,” Deep Chakraborty, CEO and Co-Founder at Enact Solar says.

Plus, prices on solar panels, inverters and batteries have decreased from Q4 2023.

More on Enact | Enact is the only two-sided platform that allows both residential and commercial users to simplify their entire solar and energy storage purchase and ownership journey, designed by Enact and delivered by local solar professionals. Enact’s integrated consumer app offers transparency and choice, accurate design and savings tracking for homeowners and installers alike. The app measures solar-plus-storage savings daily, monthly and annually, further reducing the friction for customers and improves trust in outcomes.

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