Sunprint
At a glance
Under net billing, your panels first power your home, and every kWh used that way saves what you'd have paid the utility. Whatever your home can't use right then flows to the grid and earns an Energy Export Credit for that hour. Those credits come from the CPUC's Avoided Cost Calculator, its estimate of what the power is worth to the grid, and they're usually far below the price you pay. In our model of 308 California homes, a system sized to 85% of a home's yearly use sends about 58% of its output to the grid.
So the same panels save less than they did under NEM 2.0, when exports earned close to the full retail price. Solar can still pay off: the power you use yourself saves about 29 to 35 cents per kWh at the big three utilities in our model, and the CPUC notes that a battery lets you shift solar into the evening hours when credits and prices are highest.
How net billing works
The CPUC calls it the net billing tariff, and the utilities call it the Solar Billing Plan. It covers PG&E, SCE and SDG&E homes whose solar interconnection application went in on or after April 15, 2023, under CPUC Decision 22-12-056. City utilities such as LADWP and SMUD set their own rules.
The meter counts the power you take from the grid and the power you send out separately, in each hour. Power your home uses directly from the panels never touches the meter, which is why it keeps its full value.
What exports earn, hour by hour
Each utility publishes a price for every hour of every month, separate for weekdays and weekends, in two parts: a generation part and a delivery part. The pattern is the same everywhere: spring middays, when solar power is plentiful, pay almost nothing, and late summer evenings pay the most. Averages for weekday middays (10 a.m. to 3 p.m.) and evenings (5 to 9 p.m.) for homes that applied in 2026:
Weekday Energy Export Credits for 2026 applications, generation and delivery parts added, averaged over the hours shown. Sources: PG&E's 2026 price sheet and SDG&E's 2026 export pricing file.
At PG&E, an April weekday midday earns about 0.6¢ per kWh (SDG&E: 0.4¢), while an August weekday evening averages about $1.09. Panels make little power by then, though, so what counts for most homes is the midday price. SCE's own seasonal averages for 2026 are 6¢ in summer daytime, 21¢ on summer evenings and 12¢ overnight, and 3¢, 10¢ and 10¢ the rest of the year.
Weighted by when real homes export, the 2026 credits in our model average about 5.2¢ per kWh at PG&E, 6.2¢ at SCE and 3.5¢ at SDG&E, including the bonus credit described below. If a community choice provider such as Clean Power Alliance or San Diego Community Power supplies your power, it sets the generation part of the credit, and the utility pays only the delivery part.
The rate you have to move to
Net billing homes must take a specific time-of-use rate, which the CPUC calls an "electrification" rate: lower prices most of the day, higher ones from 4 to 9 p.m. None of the three has a baseline credit. The 2026 prices per kWh for customers who buy their power from the utility:
| Utility and rate | Peak hours | Summer peak | Summer, other hours | Winter peak | Winter, other hours |
|---|---|---|---|---|---|
| PG&EE-ELEC | 4 to 9 p.m. every day | 55.2¢ | 33.4¢ most hours; 39.0¢ 3 to 4 p.m. and 9 p.m. to midnight | 32.1¢ | 28.5¢ to 29.9¢ |
| SCETOU-D-PRIME | 4 to 9 p.m. every day | 61¢ weekdays, 39¢ weekends | 26¢ | 45¢ | 24¢ 8 a.m. to 4 p.m.; 30¢ overnight |
| SDG&EEV-TOU-5 | 4 to 9 p.m. every day | 80.2¢ | 13.1¢ weekdays midnight to 6 a.m. and 10 a.m. to 2 p.m. (weekends midnight to 2 p.m.); 49.6¢ other hours | 52.4¢ | 12.3¢ super off-peak; 46.6¢ other hours |
Summer is June to September at PG&E and SCE, June to October at SDG&E. Sources: PG&E Schedule E-ELEC (June 1, 2026), SCE's time-of-use plans page, SDG&E's EV-TOU-5 total rates table (August 1, 2026). Every plan also has the Base Services Charge, $0.79343 a day for customers not on CARE or FERA.
The low midday prices are good for charging an EV or running a pool pump, but they also mean solar used at midday saves less than solar used at 5 p.m. SDG&E's 13¢ midday "super off-peak" price is the extreme case.
The nine-year lock and the bonus credit
Homes that apply by the end of 2027 keep the export credit schedule of their application year for nine years from the day their system is approved to run, which PG&E's tariff spells out. After nine years, the credits follow the current year's values. The CPUC also guarantees the original customer nine years on the tariff itself. A court challenge to net billing ended in June 2026 with the tariff upheld: see the NEM 3.0 lawsuit.
PG&E and SCE add a bonus credit, which the tariffs call ACC Plus, on every kWh sent to the grid, also for nine years. It shrinks for each new year of applications and ends after 2027:
| Application year | PG&E | SCE |
|---|---|---|
| 2023 | 2.2¢ | 4.0¢ |
| 2024 | 1.76¢ | 3.2¢ |
| 2025 | 1.32¢ | 2.4¢ |
| 2026 | 0.88¢ | 1.6¢ |
| 2027 | 0.44¢ | 0.8¢ |
| 2028 on | None | None |
Per kWh sent to the grid, residential customers. Income-qualified customers get more (PG&E 3.6¢ and SCE 3.7¢ for 2026). SDG&E has no bonus credit. Sources: PG&E and SCE Schedule NBT.
The bonus doesn't go to homes whose solar was required by the building code, and it doesn't move with a house: SCE's tariff says a new owner of a home with an existing system doesn't get it, and PG&E's excludes buyers of a home that already has solar.
Monthly bills and the true-up
Under net billing you pay a bill every month, which the CPUC says is meant to avoid a large surprise at the end of the year. In months when your export credits are bigger than your energy charges, the extra rolls over to the next month, up to your annual true-up. Credits can't pay the Base Services Charge: SDG&E and SCE both say so on their solar pages. The bonus credit is the exception; both tariffs let it pay other charges too.
At the true-up, a home that sent more kWh to the grid than it used over the year gets net surplus compensation at the wholesale price of energy, which the CPUC puts at about 2 to 3 cents per kWh. A system sized to your use, as installers normally do, rarely gets there. Our true-up guide walks through the bill.
If you already have NEM 1.0 or 2.0
Older systems keep their deal. The CPUC lets NEM 2.0 customers stay on it for 20 years from the date they were interconnected, or switch to the current tariff. A home that moves from NEM to net billing later doesn't get the nine-year legacy period, and PG&E's tariff excludes it from the bonus credit. Our NEM 2.0 vs NEM 3.0 guide compares the two.
Do you need a battery?
No. Net billing works with panels alone, and nothing in the tariff requires storage. A battery changes the math because it moves midday solar into the 4 to 9 p.m. window, when prices are highest and, in late summer, export credits are too. The CPUC says that's how customers get the most out of the tariff.
Panels alone still save money. In our model, with a system sized to 85% of a home's use and no battery, savings average about 20¢ per kWh the panels make at PG&E, 18¢ at SCE and 24¢ at SDG&E, counting the change to the required rate. Whether a battery adds enough on top to pay for itself depends on its price; our battery guide covers that.
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Common questions
What is NEM 3.0 in California?
It's the common name for the net billing tariff, which PG&E, SCE and SDG&E call the Solar Billing Plan. It applies to homes that applied for solar on or after April 15, 2023. Solar you use as it's made saves your full price; power you send to the grid earns an hourly export credit set from the CPUC's Avoided Cost Calculator.
How much does PG&E pay for solar exports in 2026?
It depends on the hour and month. For 2026 applications, PG&E's weekday credit averages about 0.6 cents per kWh at midday in April and about $1.09 on August evenings. Weighted by when homes actually export, our model puts the average at about 5.2 cents, including PG&E's 0.88-cent bonus credit.
Does NEM 3.0 require a battery?
No. Net billing works with panels alone. A battery lets you use or export stored solar during the 4 to 9 p.m. peak, which the CPUC says is how customers get the most savings, but it isn't required.
Does NEM 3.0 have a true-up?
Yes, once a year, but you also pay a bill every month. Export credits pay your energy charges each month and any extra rolls over until the annual true-up. They can't pay the Base Services Charge.
How long are NEM 3.0 export rates locked in?
Nine years. Homes that apply by the end of 2027 keep their application year's export credit schedule for nine years from permission to operate, then move to the current year's values.
Can I stay on NEM 2.0?
Yes. The CPUC lets NEM 2.0 customers stay on that tariff for 20 years from the date their system was interconnected.
Related guides
- California solar calculator
- Is solar worth it in California?
- NEM 2.0 vs NEM 3.0
- Your solar true-up bill
- Solar batteries in California
- Solar for PG&E customers
Export credits and rates change each year. Model figures are estimates for typical homes, not a quote for yours. Sources: CPUC: Net Energy Metering and Net Billing · PG&E Schedule NBT · SCE Schedule NBT · PG&E Energy Export Credit price sheets · SDG&E Solar Billing Plan export pricing · SCE Solar Billing Plan · PG&E Schedule E-ELEC · SCE time-of-use plans · SDG&E EV-TOU-5 rates · NREL ResStock. Reviewed October 2026.
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