Public entities, including municipalities, schools, water treatment plants and more are quickly approaching a deadline to secure solar projects attached with far more lucrative rates than what will soon be available.
The deadline involves net metering, a billing structure under which solar owners export excess daytime electricity production to the grid in exchange for credits on their electricity bills.
Many schools, government buildings, and other public entities applied for grid interconnection by April 14, 2023 to secure Net Energy Metering (NEM) 2.0 rates, which are far more lucrative than the rates offered to rooftop solar customers today under NEM 3.0.
Rates under NEM 2.0 moved from an average of $.30 per kWh to around $.07 per kW for Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric customers under NEM 3.0.
“The switch to NEM 3.0 negatively impacts the return on investment for solar projects and significantly extends the breakeven period for customers and in some cases, makes projects economically unavailable,” Elliot Feldman, program manager, Schneider Electric told pv magazine USA.
These public entities that have submitted to secure a NEM 2.0 rate have until April 2026 to install and complete interconnection to secure the higher rates. Projects using Net Energy Metering Aggregation structures have another year after that to complete installation and interconnection.
Though the deadline is a year away, Schneider electric said the time to act is now. Planning, permitting, and installations can easily take a year, it said.
- Reviewing system sizes – 1 month
- System design and permitting – 3 to 4 months
- Budget approval – 2 months
- System installation – 3 to 4 months
- Inspections and approvals – 2 to 3 months
Feldman shared the story of Modesto City School as an example of public sector solar energy adoption. The district serves 30,000 students across 34 schools, making it the 25th largest school district in California. Key project elements with Schneider included installing solar carports to charge their new electric bus fleet, adding solar parking canopies, and building six state-of-the-art Sustainable Outdoor Learning Environments (SOLEs), powered by rooftop solar arrays.
This project will reduce the district’s energy consumption by nearly 2 million kWh over the project’s lifetime and provides students with hands-on exposure to renewable energy technologies.
Another example is Schneider’s partnership with Los Banos Unified School District, a customer who applied to be grandfathered into NEM 2.0. Since 2022, it has completed three phases of solar projects, including installations over a new football stadium locker room, an electric school bus fleet, and an elementary school. Schneider Electric said it is about to complete construction on a new solar capacity to meet the NEM 2.0 deadline and is working with the school to consider additional solar capacity.
“Net metering is an attractive option for local governments and school districts because solar is an inexpensive energy source that significantly reduces energy bills and operating costs, ultimately saving taxpayers money,” said Feldman. “That money can be used to raise teacher salaries, refurbish aging infrastructure and upgrade academic programs among other improvements.”
Feldman said Schneider Electric helps schools and other public entities take an energy efficiency-first approach to its electricity bill savings. It assists with upgrades like LED lighting and HVAC controls before designing a right-sized solar array.
“By implementing energy efficiency solutions, we can also help our customers reinvest energy saving dollars to solve multiple problems at once while maximizing available funding sources,” said Feldman.
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