January 24, 2024

Understanding the Changes Made to NEM-A & V-NEM

Lock in the existing programs before they go away in February 2024

Ariel view of an agricultural warehouse with rooftop solar.

Recent changes approved by the California Public Utilities Commission (CPUC) revised California’s solar programs of Net Energy Metering Aggregation (NEM-A) and Virtual Net Metering (V-NEM).

The November 16 decision revises the programs to be consistent with the changes made to NEM 2.0. It transitions them into the new net billing framework, Net Billing Tariff Aggregation (NBT-A) and Virtual Net Billing Tariff (V-NBT), eliminating net metering.

What is Net Billing?

Under NEM 2.0, your excess solar energy was sold back to the grid at favorable retail rates. With last year’s change, NEM 3.0 switches to a net billing framework where California’s investor-owned utilities (IOU) purchase your excess solar at a wholesale price based on the Avoided cost calculator (ACC).

Net Billing Tariff Aggregation (NBT-A)

NBT-A, like its predecessor NEM-A, is geared towards optimizing land use, benefiting businesses with multiple meters on adjacent properties.

  • NBT-A simplifies on-site solar installations for customers with multiple meters on adjacent properties. Enjoy cost benefits, high time-of-use import rates, and fair compensation for exported energy.
  • All solar generation will be treated as exports and compensated at the ACC-based rates.
  • Utilities are scheduled to fully implement NBT-A by 2025, with detailed plans for sub-tariff aggregation and billing system alignments.

Virtual Net Billing Tariff (VNBT)

VNB-T is the new program for nonresidential customers, succeeding V-NEM. It follows specific implementation steps from the CPUC. A fundamental change for businesses is that all exported energy is compensated based on avoided costs, and imports are charged at retail.

  • Nonresidential customers must submit a complete application with the necessary documentation, such as a single-line diagram and an oversizing attestation.
  • Residential customers will receive credits against retail rates only if they are consuming energy at the same time it is generated onsite.
  • Commercial meters and energy generated in common areas will receive credits based on the ACC export rates.
  • Utilities are directed to fully implement VNB-T by 2025, aligning their billing systems and preparing for the new tariff structure.

Grandfathering NEM-A and V-NEM

The CPUC has directed utility companies to sunset the NEM-A and V-NEM programs 90 days from the November 16 decision.

Any valid interconnection applications that are submitted by February 14, 2024, will benefit from the existing programs for the following nine years before transitioning into the new tariffs.

How to get started

If you are interested in taking advantage of this grace period, Green Convergence can help your business navigate these changing policies and maximize your energy savings.

Given our proven development history of multiple commercial projects, we will handle various processes on your behalf, including the application, the interconnection agreement, the site development plan, and installation.

To get started on your application, contact us here. You can reach us by phone at 661-491-5111 or by email at commercial@greenconvergence.com.


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