Southern California Edison offers a net metering program to any customer or small business that can generate electricity from renewable resources such as hydro, wind, natural gas, and solar. Net metering allows the customer’s self-generated energy to offset their usage from the grid, so they can enjoy reduced savings.

SCE’s NEM program uses a bi-directional meter to track the net difference in kWh between excess electricity amounts. You produce the electricity you consume on a time-of-use basis during each billing period. You can either be a net consumer or an electricity generator each month. 

For example, if your household consumed 500 kWh of energy from the grid during the month and supplied 200 kWh, you would be a net consumer and charged for the 300 kWh. 

Conversely, if you supplied more energy to the grid in a given month than your household consumed, you are considered a net generator. You will be credited for the electricity supplied to the grid, less the amount provided by Southern California Edison. 

Where does SCE offer its net metering program? 

Southern California Edison’s net metering program is available across its service areas.

Fresno County
Inyo County
Kern County 
Kings County
Los Angeles County
Mono County
Orange County
Riverside County
San Bernardino County
Santa Barbara County
Toulumne County
Tulare County
Ventura County

How do you qualify for the NEM program? 

SCE requires a one-time payment of application fees. 

• $75 for projects < 1MW
• $800 for projects > 1 MW

Aside from the one-time payment of application fees, it is a requirement for customers to switch to time-of-use (TOU) rate plans. This is part of California’s statewide initiative to use more clean energy and simplify rates. TOU rate plans are based on when and how much energy you consume. TOU rates are lower during the day when SCE can tap into cheaper renewable energy sources like solar. If you take advantage of these periods when rates are lower, you can avoid the rates when energy is in higher demand, and renewable energy sources are less available. 

You will save more each month if you reduce the energy you use during your rate plan’s “peak hours,” from 4 to 9pm or 5-8pm on weekdays. Currently, SCE offers three different TOU rate plans. 

The new net metering proposal

However, in December 2021, the California Public Utilities Commission (CPUC) proposed changes to the net metering program. This was later revised in a new version and released on November 2022. 

Thankfully, the proposed initially monthly “Grid Participation Charge” under California NEM 3.0 pegged at $8 per kilowatt of solar power capacity installed on your property was removed after receiving a massive backlash from solar homeowners. The CPUC removed this solar tax that was supposed to charge $48 from homeowners monthly. 

From the net metering system, California will change this to net billing. This means the value of your excess electricity from the solar panels will be changed. California will provide a 10-year payback period for new solar installations under the “Market Transition Credit.” 

Also included in the ‘revised’ version of the proposal is to reduce the utility’s payments to homeowners for the excess power they sell to the grid. As much as 75% will be reduced to the current electricity rates. Homeowners who have existing solar systems are exempted from this. 

The proposal also promotes the installation of solar panels with battery storage. If the proposal’s approved, the state will incentivize homeowners who purchase storage batteries and their solar panel systems. Also included in the bid is the help low-income get their own systems through a $900 million funding of incentive payments.

According to experts, the proposed rules would hurt consumers. The new customers would be paid a base rate of 5 cents per kWh for the power they generate but don’t use, compared to about 30 cents now. They fear the new proposal will result in a steep decline in solar. 

What will become of my unused SCE net metering bill credits? 

Assuming you install an extensive solar panel system to meet your annual electricity needs. In that case, your solar panel will generate more electricity than you require some months and less electricity during others. 

When your panel produces more energy than you can use in a month, you will get bill credits on your SCE bill you can use in subsequent months. Suppose your panel generates more energy than you utilize in a year. In that case, you are compensated at the Net Surplus Compensation Rate (NSCR) for the extra kilowatt-hours. The excess electricity customers produce throughout 12 months is called the Relevant Period. 

SCE computes a per-kilowatt-hour rate for each month based on electricity market prices to determine the NSCR value. Your annual billing period coincides with your Relevant Period. After a year, you will get a bill credit for any additional electricity purchased at the SCE month rate. 

For example, if your Relevant Period ends in August each year, you would refer to the NSCR for August to determine your net surplus energy price.

Is there a solar incentive program offered by Southern California Edison? 

SCE does not provide solar incentives to all. But California has rebate programs for low-income households in SCE’s service territory: The Disadvantaged Communities- Single-family Solar Home (DAC-SASH) program doe low or fixed-income families; and the Multi-family Affordable Housing (SOMAH) program for renters or tenants. 

Policies and costs for SCE solar interconnection 

The final step in connecting your solar panel to the electric grid is submitting an interconnection request, which your solar installer has frequently done for you. The interconnection request informs SCE that your property has a solar power system and is safe to operate.

SCE will check your system to ensure that your solar installer complies with the following requirements:

All SCE interconnection regulations (known as “Rule 21”)
Electrical panel specifications
The National Electric Code (NEC)
Any other local codes that apply
SCE’s original net metering policy requires an interconnection request fee. 
SCE’s interconnection request fee under NEM 2.0 is $75.

What exactly does net metering means to me?

Net metering can help with high electricity costs, and it’s a fact that solar is a cheaper alternative than fossil fuels.

If you’re considering going solar for your home, request quotes from DroneQuote. 

DroneQuote is an excellent option for homeowners interested in solar but wanting to get away from the multiple sales pitches. 

From the comfort of your home, our solar experts will design a system that meets your needs, walk you through different installer quotes, and answer your questions.