Skip to main content

Our Take on NEM-3

By January 11, 2022January 13th, 2022One Comment

You may have seen more than a few news articles by now where the California Public Utilities Commission (aka the CPUC) is working towards revamping the relationship between solar owners and the three public electric utilities in the state. You can find the official documents here and lots of commentary in Google searches.

Being that we at EveryAmp are both current solar customers in California and also former employees of an electric utility here, we know a bit about this subject and the forces at work on both sides. We do agree that the current arrangement is not sustainable and changes need to be made and even made the video below several months ago about why, but the currently-proposed changes definitely miss the mark for current and future solar customers.

Tesla is one of many organizations working to change this course and they’ve set up a website to make it easy to contact the CPUC and our governor to express our concerns. Check out their website here and make your voice heard also.

You’re welcome to use/plagiarize our response below for inspiration.


As a former utility employee and CA homeowner with NEM-2 solar with battery storage, I truly understand the rock and hard place that the CPUC is currently between in regards to the future of solar in CA. However, I disagree with the current NEM-3 proposal and the impact it will have on current and future solar customers with changes like:

  1. Reducing the grandfathered NEM time period to 15 years unfairly penalizes current solar customers by changing the rules after the game has started.
  2. Per-kW fees unfairly penalize customers whose systems output less than the theoretical nameplate maximum output for various reasons like shading, fouling, orientation, and degradation.
  3. Wholesale rates for energy returned to the grid is not fair or adequate compensation for systems that were purchased at retail prices by customers.

However, I do agree that the current rules are not sustainable and changes must be made, but there are simply better ways to accomplish our goals such as:

  1. I support continuing to shift time-of-use hours and rates to better reflect the hours where energy is and isn’t in demand and the cost of energy during those hours.
  2. I support solutions like Tesla’s Virtual Power Plant which allows those of us with battery storage to supply stored energy back to the grid during times of need.
  3. I support allowing customers with energy storage to not only discharge back to the grid, but also charge from the grid during times of excess energy – just like utility-scale storage.

This arrangement directly compensates solar customers for the energy provided to the grid in proportion to the benefits they provide to the grid and promotes energy storage as the way forward for all customers. Battery storage remains prohibitively expensive for customers and a retail payback rate remains necessary to further promote the shift to renewable energy that Californians need.

The bottom line is, if the investors in our regulated utilities can expect a reasonable ~10% annual rate of return on their infrastructure investments, their customers should too.

Thank you for your consideration and service,

[Concerned Citizen]

Check out the video below for more on the technical reasons behind why we agree that the current rules are not sustainable and one possible solution that Tesla is proposing where future solar and Powerwall customers will simply decline to export energy back to the grid if NEM-3 is implemented as proposed.

Matthew Budraitis

Engineer, product designer, co-founder of EveryAmp, and a dedicated fan of EVs, technology, 3D printing, and making.

One Comment

  • Ronald Hays says:

    The name and position of the person or persons responsible for this thoughtless, knee jerk proposal need to be published. Knowing the parties responsible will allow their removal from such an influential position at the end of their term. We should not tolerate such short term, unbalanced thinking in members of an agency with so much potential damage to the future of clean air.

Leave a Reply