As a blogger and solar expert, I am often asked about the state of the solar industry, especially in places like California, which is known for leading the charge in renewable energy. Recently, the state transitioned from a net energy metering (NEM) policy to a net billing tariff (NBT) structure, essentially reducing the rates paid to customers for exporting their excess solar production.
What does this mean for homeowners considering solar panels for their home? Surprisingly, despite the apparent setback, the solar industry continues to show resilience.
First, it’s important to understand that this transition has affected the dynamics of solar installations. Before NBT was implemented, rooftop solar installations had been rising steadily, largely due to the financial incentives of NEM. With the switch and subsequent decrease in incentives, there was initial fear of a market downturn.
However, according to a report by the Lawrence Berkeley National Laboratory (LNBL), installations remain consistent, and there’s been a significant increase in battery energy storage inclusion with the solar installations. This change is noteworthy because it addresses a longstanding problem in the solar industry – the mismatch between solar-generated electricity supply and demand.
With batteries, the energy generated from your solar array for your home can be stored for use when the grid demand is high, a welcome advantage for cautious homeowners considering whether to purchase solar panels for their home. You might face a higher initial cost with the added battery, but LNBL suggests an improved return on investment relative to a solar-only installation. Bonus, you also get backup power during grid outages – a major selling point for battery inclusion!
Installers report an eight-year estimated payback period for solar systems with a battery, which is shorter than the approximately ten-year payback period for standalone solar systems. So while the NBT transition may be viewed negatively by some, it’s actually spotlighted the benefits of integrating battery storage with solar panels for your home.
The transition has also shown changes in how customers finance their installations. Ownership rates, including leased and power purchase agreement systems, showed a drastic increase under the NBT system. This transition, along with the proportional increase in installation costs due to the inclusion of batteries, attributed to a shift in loan terms for customers.
Interestingly, the NBT period has also seen an increase in consolidation among solar companies, with the market share of the top five installers rising from 40% during the last year of NEM, to 51% under the first year of NBT.
While it’s evident that the transition from NEM to NBT has dramatically changed the landscape of the solar industry in California, it remains unclear how it will shape its future. What’s clear though, is that prospective solar customers have ample opportunities to maximize their solar investment, especially with the incorporation of battery storage to their solar installations. Even with the changing policies, the solar company market continues to evolve, providing homeowners with better and more efficient ways to enjoy the benefits of clean, renewable energy.
Original Articlehttps://pv-magazine-usa.com/2024/05/23/california-is-now-a-batteries-included-rooftop-solar-market/
