What Is NEM 3.0 / Net Billing Tariff?
NEM 3.0 (officially the Net Billing Tariff) is California's current net-metering rule, in effect since April 2023, that pays solar owners roughly 75% less for excess power sent back to the grid than the prior NEM 2.0 rule did, which is why battery storage has gone from optional to close to mandatory for CA system economics.
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NEM 3.0 (officially the Net Billing Tariff) is California's current net-metering rule, in effect since April 2023, that pays solar owners roughly 75% less for excess power sent back to the grid than the prior NEM 2.0 rule did, which is why battery storage has gone from optional to close to mandatory for CA system economics.
NEM 3.0 / Net Billing Tariff explained
NEM 3.0 cut solar export credits by roughly 75% compared to NEM 2.0, starting April 2023, under California's Net Billing Tariff. Under the older NEM 2.0 rule, homeowners exporting surplus power to the grid were credited at close to the retail electricity rate. NEM 3.0 shifted that credit closer to the utility's wholesale avoided cost, which is far lower, especially during the afternoon hours when solar production peaks and grid demand is lowest.
The NEM 2.0 grandfathering window, which let existing systems keep their old export rate, closed April 15, 2026. A California Court of Appeals upheld NEM 3.0 against a legal challenge in March 2026, so the rule is not going away. Every new CA system now sells under the newer, lower export math, and the practical sales response has been to size systems around self-consumption and battery storage rather than around exporting surplus power.
This is why any solar sales content aimed at California, appointment scripts included, has to be NEM 3.0 aware or it reads as out of touch. A rep pitching a CA homeowner on the old story of selling extra power back at close to retail rate is pitching a deal structure that has not existed since April 2023.
Why it matters when you're buying
If you are buying appointments in California, confirm the vendor's scripts and qualification criteria account for NEM 3.0 economics, meaning battery attach and self-consumption sizing, not the old export-credit pitch. A CA appointment booked on outdated NEM 2.0 assumptions sets the closer up to lose the deal in the living room.
Frequently Asked Questions
What changed under NEM 3.0 compared to NEM 2.0?
Can a CA homeowner still get the old NEM 2.0 rate?
Put the playbook to work
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