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The Equity Myth: How NEM 3.0 Punishes Solar Homeowners in the Name of Fairness
by Akashma News
California regulators claim that Net Energy Metering 3.0 (NEM 3.0) is a step toward equity in the state’s energy landscape. They argue that paying homeowners less for the solar energy they export to the grid helps protect low-income ratepayers who can’t afford to install panels. But behind this narrative lies a policy crafted under pressure from corporate utility giants, shaped by powerful lobbying, and quietly rubber-stamped by an appointed commission whose political connections run deep.
Under NEM 2.0, solar homeowners received credits of 20 to 30 cents per kilowatt-hour (kWh) for the electricity they sent to the grid—roughly equal to what they paid for energy drawn from it. NEM 3.0 slashed that rate to just 3 to 5 cents per kWh for new customers, claiming the change corrects an unfair “cost shift.”
The cost shift argument suggests that solar users were underpaying for grid maintenance and public programs, offloading those expenses onto non-solar customers. While that sounds fair in theory, the reality tells a different story.
Utilities now buy surplus solar power for pennies, only to resell it to neighbors at 30 to 40 cents per kWh. The difference goes straight into corporate profits. Meanwhile, the homeowners who invested thousands in solar technology—often encouraged by state and federal subsidies—get shortchanged.
The California Public Utilities Commission (CPUC) was empowered to reform net metering under Assembly Bill 327 (AB 327), passed in 2013. That legislation gave regulators broad authority to reshape solar compensation structures—authority that utilities lobbied hard to influence, ultimately leading to the adoption of NEM 3.0.
Follow the Money: Lobbying and Political Influence
Behind NEM 3.0 are California’s energy titans: Pacific Gas and Electric (PG&E), Southern California Edison (SCE), and San Diego Gas & Electric (SDG&E). These companies have long lobbied to weaken net metering policies, claiming financial harm while reporting increasing profits. Their strategy paid off
According to data compiled by the Solar Rights Alliance and Food & Water Watch, California’s utility industry has spent over $202 million on political campaigns since 2000. Of that, $11.3 million went to sitting legislators, and $2.5 million to Governor Gavin Newsom’s campaigns alone. Newsom, in turn, appointed every member of the current CPUC.
These same companies invested another $147 million in lobbying efforts, targeting legislation and regulatory decisions. Sempra Energy (parent company of SDG&E) donated $31,200 to Newsom, while PG&E and Edison International (SCE’s parent company) contributed hundreds of thousands more. These financial ties have raised serious questions about impartiality within the CPUC.
The Vote That Changed California’s Energy Landscape
On December 15, 2022, the CPUC unanimously approved NEM 3.0 under Decision D.22-12-056. The five commissioners—Alice Reynolds (President), Genevieve Shiroma, Clifford Rechtschaffen, John Reynolds, and Darcie L. Houck—voted in favor of reducing solar compensation rates for new customers.
Though commissioners themselves are not elected and do not receive direct campaign contributions, their appointments are inherently political. Governor Newsom’s financial ties to utilities cast a shadow over the commission’s decisions, especially when those decisions disproportionately benefit corporate interests at the expense of California homeowners.
Troubling Patterns and Whistleblower Warnings
The CPUC has a troubling history of close ties with the utility industry. In 2014, leaked emails revealed that PG&E executives had engaged in inappropriate communications with CPUC officials to sway regulatory outcomes (NBC Bay Area).
In 2020, former CPUC Executive Director Alice Stebbins alleged she was fired after exposing $200 million in uncollected fees from utilities. Stebbins claimed her dismissal was politically motivated and retaliatory, reinforcing the perception that CPUC oversight is compromised (ProPublica).
The False Promise of Equity
Proponents of NEM 3.0 say it promotes equity by eliminating cost burdens on non-solar customers. But what equity is achieved when public subsidies fund private solar systems, only for utilities to seize the value of that energy at below-market rates? What fairness is there when utilities export our surplus electricity to neighboring states at wholesale prices, while Californians pay premium rates at home?
If regulators truly cared about equity, they would have expanded access to solar for renters, low-income families, and community cooperatives. Instead, NEM 3.0 slams the door on future adopters, particularly those without the means to afford expensive battery storage systems.
Conclusion: A System Rigged Against the People
This isn’t about equity. It’s about control and profit. NEM 3.0 ensures utilities remain the central power brokers in California’s energy future. It undercuts local energy independence, disincentivizes clean energy adoption, and breaks trust with the very public that paid for the green transition.
Until California dismantles the cozy relationships between regulators and utility giants, and restores fair value for solar energy, we will continue to pay a premium for our own sunshine—while the real dividends go straight to corporate shareholders.
CALIFORNIA’S SOLAR SCANDAL: THE SUN IS FREE, BUT MONOPOLY UTILITIES MAKE US PAY
By Akashma News
SACRAMENTO — California has become a national leader in solar power, boasting the largest number of rooftop solar installations in the United States. With endless sunlight and billions in taxpayer subsidies, one might expect the state’s energy costs to be low and accessible. Instead, Californians are facing skyrocketing electric bills, while utility giants reap profits from policies shaped by powerful lobbyists and a complicit state legislature.
Despite producing more electricity than the state can consume during peak solar hours, consumers are still paying among the highest rates in the nation. At the core of this contradiction lies a tale of broken promises, policy manipulation, and a green energy revolution hijacked by corporate interests.
Sunlight Subsidized by Taxpayers, Monetized by Utilities
Over the past two decades, both federal and state governments have invested heavily in making solar energy viable. Programs like the federal Investment Tax Credit (ITC) and California’s Solar Initiative (CSI) funneled billions into the development and installation of solar technology. The Self-Generation Incentive Program (SGIP) even paid residents to install battery systems.
But while taxpayers funded the transition, they were never guaranteed access to the benefits. Instead, the electricity generated by the sun — a limitless and free resource — became a product bought and sold by utility monopolies.
Net Energy Metering 3.0: A Gift to Utilities
In April 2023, the California Public Utilities Commission (CPUC) implemented Net Energy Metering 3.0 (NEM 3), slashing the compensation new solar customers receive for selling excess solar energy back to the grid. Under previous versions, customers earned between 20 and 30 cents per kilowatt-hour (kWh). Under NEM 3, new adopters now receive just 3 to 5 cents.
However, existing customers who installed solar panels under earlier NEM agreements remain “grandfathered in” and continue receiving the higher compensation rates, at least for the duration of their original contract period.
Consumer advocates and independent energy experts argue that NEM 3 is a calculated move by the utilities to undercut solar adopters and preserve profits. “This is nothing short of legalized theft,” said a renewable energy consultant who requested anonymity. “Taxpayers built the system, but utilities own the profits.”
The utility companies claim that reduced net metering rates help protect low-income ratepayers and maintain grid reliability. But the reality paints a different picture. Investor-owned utilities like Pacific Gas & Electric (PG&E), Southern California Edison, and San Diego Gas & Electric have reported rising revenues while residential electricity rates have soared.
The Lobbyists Behind the Curtain
Documents obtained through the California Secretary of State’s lobbying disclosure system show that utility companies spent millions lobbying legislators in the years leading up to NEM 3’s approval. These corporations funneled money into campaign donations, PR campaigns, and pressure groups to promote their version of a “fair” energy market.
State lawmakers, many of whom received significant contributions from energy sector PACs, largely fell in line. The result: legislation that gutted one of the most successful solar adoption programs in the country.
“The politicians in Sacramento sold us out,” said Sarah Ramirez, a homeowner in Riverside who installed solar panels in 2020. “We were promised energy independence and lower bills. Now I’m locked into a system where I sell my energy for pennies and buy it back at a premium.”
The Green Mirage: EV Costs and Energy Exports
The push for electric vehicles (EVs) has only added insult to injury. In 2019, it cost around $7 to charge an EV for 270 miles. Today, thanks to rising electricity prices, that same charge can cost upwards of $20 at public charging stations.
Meanwhile, surplus electricity produced during peak hours is sold to neighboring states at discounted wholesale rates. California residents, who helped fund the solar infrastructure, are essentially subsidizing cheap energy for other states while paying some of the highest rates in the U.S.
Who Owns the Sun?
California’s energy paradox begs a fundamental question: Who owns the sun? If the public funded solar infrastructure and the sun shines freely, why are residents paying monopoly prices for power?
The answer lies in policy manipulation and a regulatory framework that prioritizes investor returns over public benefit. Until lawmakers confront the influence of utility lobbyists and restore fair compensation to solar producers, Californians will continue to bear the burden of a broken system.
As sunlight continues to flood the Golden State, the question remains: How long will we let corporate monopolies bottle and sell our sunshine back to us at a premium?
Akashma Online News 