If you are interested in adding a PV system to your business or home and want to enroll in the NEM program, you should start your paperwork now. NEM 2.0 is going to bring some big changes.

The NEM Program, which allows residential, commercial, and agricultural customers to install and interconnect a renewable generator which is sized to meet their annual load and receive credits to offset the costs of their energy usage, is about to see some big changes. When PG&E reaches its MW cap for its current NEM program, which is 2409 MW, it will switch to the NEM Successor Program. NEM Programs affected by the cap include NEMS, NEMEXP, NEMV, NEMA, NEMVMASH, and NEMMT.

Customers that want to get into the current NEM program will want to get started as it is a long process. They will need to do three things to apply. Even if the process has been started or an appointment has been made for solar installation, these three things must be done.

  1. Complete the Net Energy Metering Application including all supporting documents and required payments
  2. Complete the Net Energy Metering Interconnection Agreement
  3. Provide evidence of the applicant’s final inspection clearance from the governmental authority

All three of these must be filled out completely to apply. If the application isn’t turned in on time for the current NEM program, you will be put in the successor program which in all likelihood will decrease the value of solar energy that is collected. Once you have turned in all your completed paperwork, PG&E will review your application and let you know if it is completed and ready for interconnection. PG&E will also let you know if you were approved for the NEM program or NEM Successor program. If you do not wish to be a part of the NEM program, you will need to inform PG&E, otherwise they will automatically enroll you.

Single Family Affordable Solar Housing (SASH) customers who join the NEM successor tariff will not need to pay any interconnecting fees.


Customers can stay in their current NEM program or move to the successor program. If the renewable generator is transferred to a new owner, operator, or PG&E account at the original location, it will not lose eligibility for the original 20-year transition period unless the previous customer has elected to transition to the NEM Successor Program. Any customer that switches from the existing NEM tariff to the NEM 2.0 will retain their benefits for 20 years starting from the original year of their approval from PG&E.

There is now no generator cap for NEM 2.0 customers, so long as your annual load qualifies, you will not be limited to 1 MW or less. Customers having generators with 1MW or less will pay a standard interconnection fee based on their PV system.

If a customer modifies or renews their renewable generator after the NEM Cap is reached, they will remain eligible for their program only if their system did not increase in size more than 10 percent of the generating capacity in the original system, or 1 kW, whichever is greater. If they did increase their capacity greater than 1 kW or ten percent, the customer cannot stay on their current NEM program. They can either meter the added capacity separately under the NEM Successor Program with their previous eligibility intact, or switch their whole system over to the NEM Successor Program.

The only thing current customers may have to change is that now all customers are now required to have their major solar PV components CEC approved and have a 10-year warranty on all major equipment and installation equipment.

Also, the current restriction on Virtual Net Energy Metering (NEMV) of having single service delivery point is being eliminated.

The requirements for when a customer can take service on the NEMV Successor tariff is pending at the California Public Utilities Commission (CPUC) and the limits will be explained in the NEM Successor tariff once it is approved.


Customers with generation systems of 1.0 MW or less will need to pay a fee for interconnection, based on the utility company’s actual costs. NEM 2.0 accounts will pay for all of the charges including Public Purpose Program Charge, Nuclear Decommissioning Charge, Competition Transition Charge, and the Department of Water Resources Bond Charges and these will not be offset by what is exported to the grid.

All customers must now be on “time of use” rates. Customers exporting during the summer will be more affected by the Non-Bypassable Charges. There will also be a decrease in the energy that is exported to the grid by about 2-3 cents per kWh.

Another downside is the utility electrical tariffs, as they will change an average of four times a year, which will affect the value of energy collected. The latest test left customers with a loss of 30-50% from their PV system and NEM 2.0 does not protect the customer in this area yet.

Once again, the NEM Successor program will be put into effect when the cap for the first NEM tariff is met, however there is no specific date for when that will happen. The NEM Successor Interconnection forms are being updated with the program’s requirements. In turn, PG&E is finalizing the approval of the NEM successor tariffs with the CPUC.

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