California NEM 3.0 Solar + Battery Payback Calculator (PG&E, SCE & SDG&E)
Pre-calibrated for California's $0.42/kWh average tariff, 5.6 peak sun hours, and 13.5 kWh LFP battery storage to maximize 4–9 PM peak arbitrage.
California NEM 3.0 Solar + Battery Payback Calculator (PG&E, SCE & SDG&E)
10-Year Cumulative Comparison
3.5%/yr tariff escalation assumptionCalculate solar and 13.5 kWh LFP battery storage payback under California's CPUC Net Billing Tariff (NEM 3.0) for PG&E E-ELEC, SCE TOU-D-PRIME, and SDG&E EV-TOU-5.
How to Beat PG&E, SCE & SDG&E Time-of-Use Rates Under NEM 3.0 in 2026
Under Decision 22-12-056 of the California Public Utilities Commission (CPUC), residential customers of Pacific Gas & Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E) are billed on mandatory electrification time-of-use rate schedules: PG&E E-ELEC, SCE TOU-D-PRIME, and SDG&E EV-TOU-5.
On these schedules, utilities charge a fixed monthly base services fee (~$15–$24/month) plus steep 4:00 PM to 9:00 PM peak rates ($0.48 to $0.64/kWh in summer), while paying an average of just $0.05 to $0.08/kWh for solar electricity exported at noon. Consequently, solar-only systems in California suffer a 9.5 to 11.5-year payback, whereas solar + 13.5 kWh LFP storage systems achieve a 5.2 to 6.6-year payback.
2026 California IOU Electrification Rate Schedule Comparison
| Utility & Mandatory NEM 3.0 Tariff | Summer Peak (4–9 PM) | Off-PeakImport | Avg Noon Export | Optimal $280/mo System Spec |
|---|---|---|---|---|
| PG&E (E-ELEC Schedule) | $0.58 / kWh | $0.34 / kWh | $0.06 / kWh | 6.0 kW (15 Panels) + 13.5 kWh Battery |
| SCE (TOU-D-PRIME) | $0.54 / kWh | $0.26 / kWh | $0.06 / kWh | 6.4 kW (16 Panels) + 13.5 kWh Battery |
| SDG&E (EV-TOU-5) | $0.64 / kWh | $0.16–$0.38/kWh | $0.07 / kWh | 5.6 kW (14 Panels) + 13.5 kWh Battery |
Mastering PG&E, SCE & SDG&E Battery Dispatch Modes Under CPUC NEM 3.0
Under California's Net Billing Tariff (NEM 3.0), the difference between a 5.5-year payback and a 10-year payback comes down to how your hybrid inverter's Energy Management System (EMS) schedules battery charging and discharging across the 24-hour clock:
- 1. "Self-Consumption / No Midday Export" Mode (October through July): From 8:00 AM to 4:00 PM, your rooftop solar powers live house loads first and diverts 100% of surplus generation into your 13.5 kWh LFP battery bank rather than exporting to PG&E/SCE for 5¢/kWh. At 4:00 PM sharp—when utility peak rates jump to $0.48–$0.64/kWh—the battery takes over your entire home load (including central AC, cooking, and lighting) until 9:00 PM or midnight.
- 2. "September / August ACC Peak Export Dump" Mode (6:00 PM – 8:00 PM): The CPUC Avoided Cost Calculator (ACC) assigns extreme scarcity values to electricity exported to the California grid during late-summer heatwaves between 6:00 PM and 8:00 PM in August and September—reaching $1.15 to $2.85 per kWh exported. By programming your battery to dump 8 to 10 kWh onto the grid during that 2-hour September window, a single 13.5 kWh battery can generate $350 to $620 in generation export credits in a single month, wiping out winter generation charges.
- 3. Non-Bypassable Charges (NBCs) & Income-Graduated Fixed Charges (IGFC): Under CPUC decisions, California utilities assess ~$0.03/kWh in Non-Bypassable Charges (funding wildfire hardening and public purpose programs) on every kWh imported from the grid, plus a fixed monthly base services charge ($15–$24/month). Because power drawn directly from your own rooftop solar and LFP battery never crosses the utility meter, self-consumed kWh bypass 100% of volumetric delivery and NBC charges.
Can existing California NEM 1.0 or NEM 2.0 homeowners add a battery without losing grandfathered status?+
Yes! Under CPUC rules, adding a 100% battery storage system (with no increase in solar panel kW beyond the 1 kW or 10% allowable repair/expansion cap) does NOT trigger a transition to NEM 3.0. In fact, adding a "non-export" solar+battery expansion system on a separate subpanel is also permitted by PG&E, SCE, and SDG&E without voiding your original 20-year NEM 2.0 grandfathering window.
How does California's Self-Generation Incentive Program (SGIP) work in 2026?+
SGIP provides upfront per-watt-hour rebates ($0.15/Wh to $1.00/Wh, or $1,500 to $10,000+ per 10 kWh battery) for income-qualified households, medically vulnerable residents on Medical Baseline tariffs, and homes located inside Tier 2 or Tier 3 High Fire Threat Districts (HFTDs) that have experienced two or more Public Safety Power Shutoffs (PSPS).
California NEM 3.0 (Solar Billing Plan) Worked Examples: Why Battery Storage Changes Everything
Under the California Public Utilities Commission (CPUC) Net Billing Tariff (NEM 3.0) covering PG&E, SCE, and SDG&E, midday solar exports earn Avoided Cost Calculator (ACC) wholesale credits (~$0.04–$0.08/kWh during most months) while 4:00 PM–9:00 PM retail peak rates often run $0.42–$0.62/kWh (check your local utility rate schedule). Here are three worked examples:
Monthly usage: $280 ÷ $0.42/kWh = 667 kWh/mo (8,000 kWh/yr). A 5.2 kW solar array (13 × 400W panels) at 5.4 California peak sun hours produces ~8,100 kWh/yr. Without a battery, the home self-consumes only ~35% (2,835 kWh × $0.42 = $1,191) and exports 5,265 kWh at ~$0.055/kWh ACC ($290) = $1,481/yr saved (leaving a $1,879/yr utility bill). With a 13.5 kWh LFP battery shifting 10 kWh/day into the 4:00 PM–9:00 PM peak window, effective self-consumption rises to ~88% (7,128 kWh × $0.44 = $3,136/yr saved)—more than doubling annual savings.
At an illustrative $0.38/kWh average tariff, a $380/mo bill equals 1,000 kWh/mo (12,000 kWh/yr). Sizing a 7.6 kW array (19 × 400W panels) at 5.6 peak sun hours produces ~12,200 kWh/yr. Pairing with 20 kWh of LFP storage allows the household to run evening air conditioning from stored solar between 4:00 PM and 9:00 PM while charging the EV during super-off-peak hours—offsetting roughly $4,150/yr in SCE charges.
Under the CPUC Avoided Cost Calculator schedule, late-summer evening export credits in August and September spike sharply between 6:00 PM and 8:00 PM when the California grid faces peak thermal strain. Programming a 13.5 kWh hybrid battery into "Time-of-Use Export Mode" during September evenings discharges stored midday solar during those high-value ACC hours to build bill credits for winter months.
Common Mistakes to Avoid Under California NEM 3.0
- Mistake 1 — Installing Solar Panels Without a Battery in PG&E, SCE, or SDG&E Territory: Under NEM 1.0 and 2.0, the utility grid acted as a free 1-to-1 battery. Under NEM 3.0, exporting unbuffered midday solar at ~5 cents/kWh and buying it back at 48 cents/kWh at 6:00 PM stretches solar-only payback beyond 11–13 years.
- Mistake 2 — Facing All Panels Strictly South Instead of a West / South-West Split: Facing half of your array West (240°–270° azimuth) extends solar generation deeper into the 3:00 PM–6:00 PM afternoon ramp, reducing the battery capacity needed to bridge the evening peak.
- Mistake 3 — Overlooking California SGIP & Income-Qualified Battery Rebates: California's Self-Generation Incentive Program (SGIP) and utility-specific battery storage programs periodically open funding tiers for residential storage—always check current CPUC SGIP budget status.
California NEM 3.0 Solar & Battery Calculator FAQs
Which California electric utilities are governed by NEM 3.0 (Net Billing Tariff)?
NEM 3.0 applies to California's three big investor-owned utilities (IOUs) regulated by the CPUC: Pacific Gas & Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E). Municipal utilities such as LADWP, SMUD, and Silicon Valley Power set their own separate solar rates—check your local municipal utility website.
What are the mandatory Electrification Time-of-Use rates under NEM 3.0?
NEM 3.0 customers are placed on dedicated electrification TOU schedules: PG&E E-ELEC, SCE TOU-D-PRIME, or SDG&E EV-TOU-5. Each includes a fixed monthly base services charge alongside wide peak-to-off-peak price differentials designed to reward battery self-consumption.
If I already have a NEM 1.0 or NEM 2.0 system, will adding panels push me into NEM 3.0?
Under CPUC rules, expanding an existing NEM 1.0/2.0 array by more than the greater of 1 kW or 10% of original capacity typically transitions the account to NEM 3.0, unless you install a separate non-export (zero-export) solar + battery sub-system that never backfeeds the utility grid. Confirm current interconnection rules with your utility before expanding.
How do California's new Income-Graduated Fixed Charges (IGFC) affect solar payback?
Under AB 205 (implemented by CPUC Decision 24-05-028 across 2025–2026), California IOUs introduced a fixed monthly charge (~$24.15/mo standard tier, lower for CARE/FERA customers) paired with a 5 to 7 cent/kWh reduction in volumetric rates. Solar and batteries offset the volumetric kWh portion of your bill, not the fixed monthly base charge.