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Data last verified: August 2026Net Metering in America: The 2026 Timeline
Direct answer
The era of full-retail net metering is ending. California’s NEM 3.0 (April 15, 2023) cut export rates from ~$0.28–0.35/kWh to an average of $0.03–0.08/kWh for new PG&E, SCE, and SDG&E customers — a 60–80% cut that made batteries effectively necessary. NEM 2.0 customers who filed before April 15, 2023 are grandfathered for 20 years from Permission to Operate; the final PTO deadline was April 15, 2026. Nevada, Hawaii, and Indiana have already reduced export compensation, and Oregon, Colorado, and Michigan are rewriting their rules in 2026. Source: CPUC D.22-12-056 (retrieved Aug 2026).
The complete timeline
| Date | Event | Impact |
|---|---|---|
| Pre-2016 | Full-retail net metering era (most states) | Every exported kWh credited at retail — oversizing was rational |
| 2016–2022 | First state rollbacks (NV, HI, AZ caps) | Export compensation began dropping from retail toward wholesale |
| Dec 15, 2022 | CPUC approves NEM 3.0 (D.22-12-056) | California sets the national precedent for net billing |
| Apr 15, 2023 | NEM 3.0 takes effect (PG&E / SCE / SDG&E) | New solar customers earn Avoided Cost Calculator rates (~$0.03–0.08/kWh avg); solar-only payback jumps to 9–13+ years |
| 2023–2026 | NEM 2.0 grandfathering window | Customers who filed before Apr 15, 2023 keep retail credits for 20 years from PTO; battery attachment rises from 11% → ~70% |
| Apr 15, 2026 | Final NEM 2.0 PTO deadline | Grandfathered systems not yet operating by this date fall to NEM 3.0 |
| Mar 2026 | CA 1st District Court of Appeal upholds NEM 3.0 | Ends the most credible legal challenge; NEM 3.0 is the rule for the foreseeable future |
| 2026 ongoing | OR, CO, MI revisit net metering; NV/HI/IN already cut rates | National trend: net billing / avoided cost replaces full-retail credits |
Which bucket are you in?
| Your situation | What applies | Strategy |
|---|---|---|
| Filed with PG&E/SCE/SDG&E before Apr 15, 2023, operating before Apr 15, 2026 | NEM 2.0 grandfather (20 yrs from PTO) | Full-retail exports — oversizing still makes sense; adding a battery does not affect grandfather status |
| New California IOU customer (2026) | NEM 3.0 net billing | Self-consumption + battery is the only strong-ROI path; size to usage, not production |
| LADWP / SMUD / municipal utility | Own net metering rules (not NEM 3.0) | Often more favorable to exports — confirm with your utility before modeling |
| Other states (NV/HI/IN already cut; OR/CO/MI reviewing) | State-specific net billing / avoided cost | Check your state guide; batteries matter more where export rates are weak |
Why the era of full-retail net metering is ending
Regulators in California (and increasingly elsewhere) concluded that full-retail net metering shifted grid costs onto non-solar customers — renters and lower-income households who cannot install panels — and that it flooded the grid with midday solar while doing nothing for the evening peak. Net billing prices exports at what the grid actually saves (avoided cost) and rewards storage + self-consumption instead. The design intentionally makes batteries the economic centerpiece of new solar systems.
What this means for your solar decision
- Export rate is now the #1 economic variable — bigger than your production or even your state credit in net-billing states.
- Self-consumption is king: shift laundry/EV charging to solar hours, or add a battery to capture the 4–9 pm price spread.
- NEM 2.0 grandfathers are valuable: if you qualify, the retail export credit is worth keeping — don’t voluntarily switch rate plans.
- Run your state’s numbers: use the ROI calculator or the battery payback tool with your actual export credit.
Disclaimer: Net metering rules are utility- and state-specific and change frequently. Figures are from CPUC D.22-12-056 and state policy updates (retrieved Aug 2026). Verify your exact terms with your utility before modeling. See the net metering vs net billing guide and the California NEM 3.0 payback guide.