CPUC Postpones NEM 3.0 Decision After Hearing from Rooftop Solar Customers

San José Clean Energy (SJCE) and the City of San José see rooftop solar as an important tool that residents and commercial customers can use in the fight against climate change. We are pursuing an aggressive Climate Smart San José goal of becoming the first city in the US to install 1 gigawatt (1,000 megawatts) of rooftop solar by 2040.

In December 2021, the California Public Utilities Commission (CPUC) proposed a new set of rules — known as Net Energy Metering (NEM) 3.0 — for how PG&E and other investor-owned utilities (IOUs) must compensate rooftop solar customers for the energy their panels produce and how much they should pay to access the grid.

The solar industry and most environmental advocates have expressed concerns that the proposed CPUC changes would halt rooftop solar adoption and set California back in achieving its climate goals. Overall, the proposed rules would result in 70-80% lower compensation for energy exported to the grid from solar systems and large IOU charges for rooftop solar customers (~$40-60 per month), lengthening investment payback periods to 16 to 18 years.

In their press release, the CPUC wrote that “NEM must be modernized to incentivize customers to install storage paired with rooftop solar to help California meet its net peak shortfall and ensure grid reliability.” Through the proposed rules, the CPUC asserts it is creating “more accurate price signals that will provide more value to the electric grid.”

We believe that reaching a 100% clean energy, electric future in California will require aggressive deployment of rooftop solar and home energy storage and utility-scale renewable energy paired with short and long-duration storage (learn more about our $1 billion in investments in the latter).

What San José Clean Energy Is Doing About NEM 3.0

We are advocating for our current and future rooftop solar customers to the CPUC as an official party to their Net Energy Metering proceeding. On January 7, SJCE filed comments on the CPUC’s Proposed Decision opposing proposed changes that disincentivize the adoption of rooftop solar and storage, especially among low-income customers and vulnerable communities.

Given the prevalence of solar in San José, we want to make sure our customers are aware of the CPUC’s proposed changes. San José Clean Energy solar customers would be impacted by new NEM 3.0 utility charges because they remain PG&E customers for electric delivery.

Current Status

In early February, the CPUC postponed their vote on the proposed NEM 3.0 rules indefinitely. We will keep our customers updated on the final vote and adopted rules. Once the CPUC adopts new NEM 3.0 rules, they would go into effect one year later.

Who This Impacts

While the changes to solar customer rates, fees, and credits for exported solar power would apply to new rooftop solar customers, the CPUC proposes to decrease the earlier CPUC grandfathering period protecting existing solar customers from 20 years to 15 years. Once an existing solar customer has had their system operating for 15 years, they would be switched to NEM 3.0 compensation rates, TOU rates and monthly IOU charges, with details depending on their customer class and location.

Summary of Proposed Changes

  • PG&E’s average customer compensation for solar production would decrease by 70-80% to about 5 cents per kWh for residential customers. The new compensation rate would be fixed for five years and then change annually and would vary on an hourly and monthly basis and by climate zone, making it difficult to calculate how much savings solar customers could earn from their rooftop solar systems.
  • On top of this, most residential solar customers would have to pay a new monthly IOU “Grid Participation Charge” of $8 per kilowatt (kW)/month, or about $40-$60 per month for the average-sized solar system.
  • Residential customers who move onto NEM 3.0 between 2023 and 2026 could lock in a Market Transition Credit (MTC) for 10 years. The amount of the credit (max $5.25 per kW) would depend on their income level and when they install solar. Over the first four-year period of NEM 3.0, the credit would decrease by 25% each year. So a customer installing solar in 2023 would be eligible for a higher monthly credit than a customer installing solar in 2025. The program sunsets after 2026.
  • Most new residential solar customers would also be put on a new time-of-use rate plan where energy would cost substantially more in the evening, when they are drawing electricity from the grid, to incentivize installation of home energy storage like batteries. This mandatory rate would also include new fixed IOU charges, in addition to the Grid Participation Charge.
  • The CPUC also proposes to create a four-year $600 million equity fund to increase low-income access to solar and storage, though the details are undefined.
  • Existing rooftop solar customers would be eligible for rebates for batteries of $200/kWh, or about $2,600 for the average home system, that are installed between 2023 and 2026. The battery rebate level steps down 25% per year then ends after 2026. To accept the rebate, these customers would immediately be put on NEM 3.0 compensation rates, TOU and utility charges.

More details are in the CPUC’s Proposed Decision.

What You Can Do

The Solar Rights Alliance has put together a list of actions that those who are opposed to the CPUC’s Proposed Decision can take:

  • Sign a petition to Governor Newsom
  • Call the Governor
  • Post on social media
  • Alert your neighbors with solar
  • Give verbal comment to the CPUC
  • Write a letter to your local newspaper

SJCE Service Will Be Even Cleaner in 2022

We’re here to help as all electricity customers can expect higher bills

On December 14, the City Council set SJCE’s 2022 power mix and rates that will take effect January 1. Here’s what you can expect as an SJCE customer:

Cleaner Power

We are blazing the trail on climate action by increasing the renewable energy content in our standard service GreenSource to 60% to help San José meet its new, ambitious carbon neutrality goal. San José is the largest US city to pledge to reach net-zero greenhouse gas emissions by 2030 from electricity; fuel use in buildings, transport, and industry; and waste. SJCE will play a critical role. GreenSource will be 95% carbon-free in 2021.

TotalGreen will continue to be an easy, cost-effective way for customers to increase their climate impact by powering their home or business with 100% renewable energy for about $4 more per month than GreenSource for the average home.

In 2022, some of the renewable energy will come from two new SJCE renewable energy and storage projects that have recently begun producing power. Our innovative 62 MW solar plus storage project in Kern County will guarantee 16 hours of renewable energy every day, seven days a week. In New Mexico, our first 225 MW investment in wind has also begun producing emission-free power. Two more new projects will come online by the end of 2022. Over time, these projects can lower our power supply costs.

Higher Bills for Everyone

However, power supply costs in the energy industry rose in 2021 and are expected to be high and volatile in 2022, causing more expensive bills for everyone. This is due to the pandemic, drought, and other market factors. PG&E has requested to increase its generation rates by as much as 35%.

SJCE will still offer competitively priced service options that give you cleaner power, local control, community programs, and more transparency and accessibility. Customers will not save money by opting out. Our lowest cost service GreenValue will continue to cost the same as PG&E while GreenSource monthly bills will cost the average home about $12 more.

SJCE choices

We are taking action to improve stability and affordability for our customers by building reserves and exploring cost-of-service rates that are not driven by PG&E rate fluctuations.

How to Save on Your Bill

We are here to help. We have service options to meet different households’ needs and lifestyles, and we can help you find ways to save money and pay off debt. Here are the top actions you can take to save on your bill:

    1. See if you qualify for CARE or FERA, state discount programs that give income qualified customers up to 35% off their energy bills
      • If you are a CARE or FERA customer, you are automatically enrolled in our SJ Cares program, which will give you 60% renewable energy at our lowest rates
      • If you live in certain neighborhoods in San José, you might also qualify for our Solar Access program, which offers a 20% bill discount on top of CARE/FERA discounts. Spots are currently available in the program!
    2. If you are cost-conscious, you can enroll in our GreenValue service online or by calling 833-432-2454 at any time. You’ll need your PG&E account number, name on the account, and service ZIP code.
    3. Find the right rate plan for your household and try to save energy where you can. Most San José homes save money on time-of-use (TOU) rate plans where electricity costs more from 4 p.m. to 9 p.m. Tips to conserve energy:
      • Turn off all but essential lighting
      • Run large appliances like your dishwasher, washing machine, clothes dryer, and oven during off-peak hours (before 4 p.m. and after 9 p.m.). Use the delay start function or a timer to help!
      • Charge electronics overnight, including EVs
      • In the summer, pre-cool your home in the morning to reduce the need for air conditioning during peak hours. Set the thermostat for your air conditioner at a higher temperature.
      • Sign up to receive monthly texts with energy-saving tips and reminders from SJCE by texting “CLEAN” to 833-415-2329
    4. Get paid to save energy by OhmConnect. OhmConnect is a Bay Area-based demand response provider that pays California residential customers to decrease their electricity usage a few hours per week in the summer and fall during “OhmHours.” (OhmHours occur less frequently in the winter.) It’s free to sign up and participate in their program, and the amount you make is based on the amount of energy you save. Compensation multiplies with each smart device you connect, including smart thermostats.

Our customers are at the core of what we do. Thank you for being a valued customer.

We’re Your Local Clean Electricity Provider – But What Does That Mean?

San José Clean Energy (SJCE) is your local, not-for-profit electricity provider operated by the City of San José. We source and build clean electricity for you – also known as electric generation – while PG&E continues to deliver it to you over its poles and wires (electric delivery) and bill you.

The clean energy you receive from SJCE is not an extra charge. All electricity customers, whether they are enrolled in SJCE or not, pay for both electric generation and delivery. Before SJCE launched in 2019, PG&E was the only electricity provider in San José, so electric generation and delivery were bundled together into an “electric charges” line item on your PG&E bill. Now, they appear as two separate line items. In the details of PG&E electric delivery charges (usually page 3 of your bill), you will see a generation credit. This is what PG&E would have charged you for electric generation. Your generation charges are detailed in the SJCE portion of your bill (usually page 4). This is proof that there are no duplicate or extra charges for clean energy.

Page 3 of Your PG&E Bill:

Now, with SJCE, you have a choice for how much clean energy you receive and how much you pay. We offer clean energy options for everyone. Whether you tend to be more cost-conscious or climate-conscious, we have an option for you. And since our services offer more renewable power than PG&E, you’re helping improve air quality and fight the climate emergency faster simply by being our customer.

We’re here for you – we can guide you to resources to manage and lower your bill. Local control means that our revenues are reinvested into the community through competitive rates and valuable programs that create healthier air and neighborhoods. You are the core of what we do, and we strive to serve you with transparency and accessibility.

Interested in learning more about how SJCE works? Visit our About SJCE page or Frequently Asked Questions (FAQs) page for more information.

Why Your Power May Go Out this Summer and How to Prepare

San José Clean Energy customers face three kinds of power outages: PG&E planned power shutoffs (or public safety power shutoffs (PSPS)); rolling outages; and shutoffs due to PG&E equipment failures.

PG&E planned power shutoffs are declared by PG&E to prevent their distribution and transmission line equipment from starting wildfires and are likely to occur when weather conditions are hot, dry, and windy.

The CPUC has identified the areas surrounding San José as elevated fire-threat, with some parts as extreme fire-threat. In October 2019, more than 20,000 San Jose residents were left without power due to PG&E’s planned power shutoffs, some for multiple days.

Rolling power outages are called by California’s state run, non-profit grid operator (CAISO) when the state’s power demand is within 3 percent of available supply. In August 2020, California experienced rolling power outages during a record-breaking heat wave. Rolling outages on subsequent days and over Labor Day weekend were prevented by Californians who lowered their usage from 3 p.m. to 10 p.m.

San José was not impacted by rolling outages on August 14 and 15, 2020, but more than 86,500 customers experienced outages due to PG&E equipment failures when their substations and distribution equipment were taxed by the high heat.

How to Prepare for PG&E Planned Power Shutoffs

All residents should sign up to receive power shutoff notifications from PG&E and make sure your contact information is up-to-date, especially if you or someone you care for relies on electricity for medical needs. Non-account holders can also sign up to receive alerts.

To prepare your household for multi-day power outages, create an emergency plan, practice it, and assemble an emergency supply kit.

Visit our PG&E Power Shutoffs page for additional guidance and information.

Battery storage

Backup battery storage provides a line of defense against planned and unplanned power shutoffs and can power vital equipment for vulnerable customers. Currently, lithium-ion batteries are the primary clean energy storage solution to power homes during power shutoffs on the market. When paired with rooftop solar, excess solar energy produced by solar panels can be stored for later use in batteries for backup of critical loads in homes.

You can find out more about other lower cost backup power options on our page.

The Silicon Valley Independent Living Center (SVILC) is a local disability justice organization. During PG&E power shutoffs, SVILC supports customers who rely on power to operate life-sustaining medical devices in the following ways:

    • Disaster kits and training
    • Portable battery rental program
    • Emergency resources
    • Help with Medical Baseline enrollment, a program for qualifying residents to receive lower energy rates

COVID Customer Protections Extended Through September 30

The past year has been difficult, and while our economy is reopening, we know many are still struggling to keep up with utility bills. We want to continue to support you through this process and provide resources to help you recover financially.

The California Public Utilities Commission recently voted to extend COVID-19 customer protections through September 30, 2021 (previously June 30, 2021). This means you are still protected from having your power turned off due to nonpayment. However, if you have an overdue balance on your electricity bill it is still important to develop a plan and take action as soon as possible to avoid disconnection once protections expire.

To help, SJCE has outlined a list of electricity bill assistance programs that you may be eligible for. Visit our discount programs page or call 833-432-2454 for more information, including eligibility requirements and how to apply. Customers can also sign up to receive texts from SJCE with tips on how to save money and program updates. Text SAVINGS to (833) 415-2329 to sign up today.

smart thermostat

Get a free smart thermostat from OhmConnect & help reduce need for blackouts

SJCE is proud to be a part of OhmConnect’s City Energy Challenge this summer. To help prevent blackouts, OhmConnect is partnering with California cities to give away up to 1 million smart thermostats. Installing 1 million smart thermostats can save 680 megawatts (MW) of energy — or nearly twice the shortfall that caused rolling blackouts in August 2020.

OhmConnect is a Bay Area-based demand response provider that pays California residential customers to decrease their electricity usage a few hours per week during “OhmHours.” It’s free to sign up and participate in their program, and the amount you make is based on the amount of energy you save. Compensation multiplies with each smart device you connect, including smart thermostats.

Through September 30, SJCE customers enrolling in OhmConnect’s program can choose to receive a free smart thermostat or two smartplugs plus $25 from OhmConnect. There is also the option to not receive any freebie and simply enroll in the program. Customers receiving devices must install and connect them to wi-fi within 30 days, and OhmConnect can provide installation support over the phone. During energy saving events, OhmConnect can automatically adjust customers’ thermostats or smart plugs to help them save energy. Customers are given 24 hours advance notice of an OhmHour and are able to opt out if they do not wish to participate. Otherwise, customers are encouraged to unplug or not use devices and appliances.

So how does it work? OhmConnect bundles its customers’ reduced demand and sells it into CAISO’s energy attributes markets. In addition to helping improve grid reliability, demand response programs help reduce greenhouse gas emissions from electricity. Natural gas peaker plants have typically been utilized to help meet periods of peak demand; reducing load at this time through demand response reduces reliance on fossil fuels.

San José is one of many California cities participating in OhmConnect’s City Energy Challenge. The California city that connects the highest percentage of residents to OhmConnect’s platform by September 30 will win 10 $5,000 scholarships for its residents and the coveted title of “Energy Saving Superhero.”

For more information about OhmConnect, read FAQs.

Enroll in OhmConnect and claim your smart thermostat or plugs + cash