Solar batteries and net metering - now approved in California

Published on 14 Feb, 2019 by Michael Bishop

Categories: Solar + batteries


Solar battery economics just got a lot brighter in California.


Solar battery and dollar


First, a little background:

With net energy metering, you can send extra solar energy to the electric grid — and get full retail credit for it (or almost-full retail credit). In other words: if the utility is charging 20¢ per kilowatt-hour (for example), your extra solar kilowatt-hour would be credited at 20¢. That’s a good deal!

In fact, net metering has been the #1 most important policy behind solar energy’s huge growth in recent years.

With a “time-of-use” rate plan, the cost of electricity is different across the day. For example, it might be 30¢ during the “peak” window, and only 10¢ during the “off peak” window. In California, the expensive peak electricity used to be in the afternoon (because the utility had the hardest time providing electricity in the afternoon). But because of all that new solar energy flooding the electric grid, utilities have moved the expensive peak window to the evening.

Solar energy and time-of-use rate plans used to go together like hand and glove, because all that afternoon solar energy was credited at the high-value peak rate. But now, sadly, most solar energy is credited at the low off-peak rate. And under California’s current net metering 2.0 policy, you have to switch to a time-of-use rate plan to quality for net metering.


Solar batteries to the rescue?

Batteries for storing electricity have gotten a lot cheaper in recent years. Here’s a bright idea — get a battery to store the extra solar energy made in the afternoon. Once the evening’s peak window starts, send that extra solar energy to the grid for the high-value peak credit!

Alas, that isn’t allowed in California — you won’t get retail credit for any electricity sent from the battery to the electric grid.


Solar batteries will get net metering credit soon

On January 31st, the California Public Utilities Commission (CPUC) released a decision that will let you get retail credit for your battery-stored electricity! So, with a battery, you can get the absolute most financial value out of your solar energy system. This should take effect in the next few months.

Using a battery to send stored solar energy to the grid in the evening isn’t yet a good financial investment in its own right (because the battery system costs money after all). But if you’d like to get a solar battery anyway for backup (to keep the lights on during power outages), this net metering trick will help you pay for it.

In order to qualify, you’ll need to demonstrate to the utility that your battery will only be charged by your solar panels (in other words, it’ll never be charged by the electric grid). Fortunately, this CPUC decision also said it’s okay for software to automatically handle this for you — you can set it and forget it, and you won’t have to buy expensive electrical equipment. In other words, the CPUC will trust that pre-approved off-the-shelf software is up to the task.

Along with the net metering credit, your solar battery should qualify for California’s Self Generation Incentive Program rebate.


Conclusion

This CPUC decision makes the solar battery economics much better. Between net metering, plummeting battery costs, the California rebate, and the 30% federal tax credit...a solar battery has never been more affordable.

A local installer can show you your personalized solar + battery economics. Find 5-star installers near you at SolarReviews.com.

And check out solar expert Andy Sendy’s perspective on adding solar batteries when buying solar.



Author: Michael Bishop

Michael's core purpose is to improve the customer experience around going solar. He primarily pursues this by writing articles and software at CutMyBill.