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PG&E Net Metering Explained

PG&E power meter

Do you know how PG&E net Metering works? If you are planning to go solar or you have already gone solar, you most likely have a number of questions about PG&E net metering.

Understanding how this smart net metering works will allow you to know the amount of energy your rooftop solar generate, how much you utilize, how much you give as surplus to the electricity grid, and most importantly, how much you pay for it.

In this article, we provide answers to frequently asked questions and show you how to go about these issues.

How does Net metering Work?

power meters

The net metering is a solar incentive that encourages you to store surplus energy from your home in the electric grid. When your solar panels produce more energy that surpasses your home requirement, the excess energy is relayed to the grid. When your solar under-produces energy, especially during the night and winter, you get the chance to cover your energy needs from the grid.

Net meters come in handy at measuring the amount of electricity you supply to the PGE and how much you utilize from the grid. As such, the units of power you use from the grid are often offset by the excess power you supply them from your solar. At the end of the month, you are only required to pay for taxes, basic services, and other adjustments that are not related to the amount of power you use.

Credit for Extra Generation

The excess electricity transmitted to the grid from your solar system is credited to your PG&E account where it continues to accumulate for future use.

This means that the accumulated credits that you transmit during hot summer months can be drawn and used during the cloudy and cold winters when your solar electricity production does not meet our home power demands.

What are the PG&E's rates and prices for net metering?

clock with coins stacking up showing cost of electricity

Payments for extra energy are dependent on state legislation. In California, it is priced at $0.03 to $0.04 per kilowatt hour. However, there are two types of compensation to customers.

You can opt for a tiered rate plan where your kilowatt cost remains on the lowest priced tier until you attain your baseline allowance. The current season and where you live will determine your baseline allowance. Once your energy credits pass the baseline allowance limit, the price per kWh will also increases.

The second compensation is time-of-use plans. In this plan, energy is charged based on the time of use. While energy becomes expensive during high demand hours like in the evening, it is also lowest during off-peak hours. New solar customers automatically get enrolled under this plan. Equally, the energy you transmit to the grid at peak hours will also be of more value. Here are the peak and off-peak hours:

  • 7 am to 2pm: 22.282 $ per kWh partial-peak

  • 2 pm to 9 pm: 42.464 $ per kWh –peak

  • 9 pm to 11 pm: 22.282 $ per kWh – partial-peak

  • 11 pm to 7 am 9.746 $ per kWh off-peak

My solar panel is generating power but the meter is rolling backward and NEM is yet to activate it. What happens to the extra power I produce?

Once you turn on your solar panel system, you will enjoy using the generated power. The surplus power is relayed to the grid to power the neighboring homesteads and businesses. You, however, will not earn any credit for the extra power generated since the NEM is not activated to capture your credits for extra energy generated.

How can I know When NEM is activated?

Typically, PG&E sends you a ''Permission to Operate'' notification for your solar system that activates NEM. Alternatively, you can contact PG&E for an update.

What is the PG&E's Net Metering cap?

The net metering cap of the PG&E is set at 1 megawatt. However, the aggregate capacity cap is 5 percent of the utility's aggregate client peak demand. These limits cut across PG&E, San Diego Gas & Electric, as well as Southern California Edison.

Does PG&E offer other solar incentives?

Besides net metering incentives, PG&E also offers two other incentives to customers with an aim of lowering the cost of solar systems for your home. The Multifamily Affordable Solar Housing program is geared toward providing solar panels to low-income multi-family homes while the New Solar Homes Partnership helps with the financing of solar panels for new and energy efficient homes. On top of this, it also provides solar water heating among other renewable energy sources incentives.

How long does PG&E take to turn on NEM?

Once YES files your NEM application, it will take about two business days for your solar installation to pass the final inspection at the Building Department. After that, PG&E will require about 30 business days to have you interconnected and your NEM activated. Nonetheless, PG&E has been taking about 8 to 10 business working days to complete the whole process. However, you should note that PG&E does not accept a NEM application without a signed and complete permit.

My PG&E bill indicates that I am under a Community Choice Aggregation for Electricity. Does it mean my billing with solar is different?

If your PG&E bill comprises Community Choice Aggregation (CCA) like Peninsula Clean Energy or any other CCAs, then your net metering works a little different based on the individual CCA policies. However, most of these CCAs programs bill monthly for energy rather than yearly.

When you have more credits for a higher generating month, like let's say July, the extra credits will be carried forward when solar panels tend to generate more power. This will allow your extra credits to offset the coming month when you under-produce electricity.

However, during under-generating months like January, the available credits will be applied first and any remaining balance will be billed. Note that different CCAs have their own billing policies. As such, you will need to check with your CCA to know their specific net metering policies.

How do I Verify if My NEM is working?

You can do this by logging into PG&E account and then look for your usage. If it is on a sunny day, your NEM system should generate more power than you use.

Why are the numbers on my online solar monitoring portal higher than on the PG&E website?

The difference is brought by the fact that the online solar monitoring system traces the total power generated. You will find that energy generated by solar is immediately utilized to power home appliances that might be running during the day.

However, the excess power is not used directly by your home. Instead, it is passed on to the grid through the PG&E smart meter. The PG&E only tracks the extra power and not the one generated by the solar.

As such, the PG&E will show how much extra power you have relayed to the grid and the power drawn from the grid during your little to no solar generation like during the nights and on cloudy days. When you sum up the two, you will get your Net Usage which is shown on your PG&E bill.

However, to get the total power consumption for your home, you will need to take the numbers indicated on the monitoring portal and add them to your Net Usage on the PG&E bill for the same period.

Total Power Consumption = Solar Production + Net Usage

How can I calculate my daily home consumption?

If you want to calculate your power consumption for a particular day, you have to consider the following. Let's say that on the particular day, your solar monitor reports 50 kWh while the PG&E indicated your Net Usage of -10kW. The negative report means that your solar system produced more energy than you consumed. To get the actual consumption of electricity at your home, add the two figures.

Consumption = Solar Generation + Net Usage = (50kW) + (-10kW) =40kW

So, on this day, your home used 40kW of electricity.

How long will PG&E Warranty my NEM plan?

The PG&E net metering can last for up to 20 years from the date you get your Permission to Operate. However, PG&E might make considerable changes to the NEM program that regulates new solar panels without affecting your initial NEM agreement.


To know how much electricity your solar systems produce, your consumption, and the amount that you send to the grid, you must have an effective net metering device. We have answered as many questions as possible yet we have not exhausted them. If you have any pressing question that we have not covered here, feel free to ask it in our comment section.

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