NEM 3.0 Explained: What California Homeowners Must Know in 2026

What NEM 3.0 changed vs NEM 2.0

Under NEM 2.0, many homeowners received credits close to retail for exported kilowatt-hours. NEM 3.0 (effective April 2023) pays far less for exports—especially during midday when solar production peaks. Your design goal shifts from "maximize exports" to maximize self-consumption.

For the full technical deep dive, read our NEM 3.0 California solar guide (2026).

Export compensation and avoided-cost rates

Southern California Edison assigns time-varying export values. Midday exports are worth the least; evening hours can be worth more—but still below old NEM 2 retail parity. That is why two homes with identical panel counts can see different savings if one runs pool pumps and EV charging at noon and the other sends power to the grid.

Battery vs oversizing panels under NEM 3

Batteries store midday solar for evening use. More panels increase instantaneous production so you can run loads while the sun is up. For many Orange County homes, additional high-output 710W+ solar panels beats a small battery on pure ROI—though Tesla Powerwall installer still makes sense for backup.

SCE interconnection timeline

After city permit approval, SCE review and Permission to Operate (PTO) commonly take several weeks. Your installer should submit clean one-line diagrams and equipment lists to avoid rework. We handle SCE paperwork for every Orange County solar project.

Action checklist before you sign a contract

• Demand production modeling under NEM 3—not NEM 2 assumptions
• Compare panel wattage (400W vs 710W+ solar panels) and panel count for the same kW
• Review line-item pricing and 30% ITC eligibility
• Ask how EV, pool, and AC loads align with solar hours

Ready for numbers on your bill? Request a free solar quote with NEM 3.0-aware modeling.