Tesla expects its Powerwall to become an even bigger differentiator for solar homeowners in California following a change in net metering.
California changed its net metering rules starting this week. The New Net Billing Tariff (NBT), sometimes referred to as NEM 3.0, is now the new solar billing policy, and essentially results in the removal of the model of being credited for returning energy to the grid at the import price. .
Instead, solar power system owners now get a credit to send power into the grid at the value of the utility’s avoided cost, which is similar to the wholesale cost of a large power plant. .
This results in a significant drop in the value of the energy that an individual can send back to the grid most of the time, with a few exceptions – notably in the evening of September.
Tesla has informed its customers of these changes and believes it has significantly increased the value of solar-powered combination batteries, such as Powerwall, for these reasons:
- Using more solar energy allows customers to save more: Adding Powerwall allows you to store solar energy and use it later, instead of exporting it to the grid for minimal credit. A solar-only system will reduce the median customer’s electricity bill by 57%; with Powerwall, the bill will be reduced by 92%.*
- Earn more during “Power Hours”: Powerwall’s smart, customizable software lets you take advantage of September’s “Power Hours” when credits are 75 times higher than the month’s lowest export prices.
For example, with PG&E, these “Power Hours” translate to a rate of $2.87 per kWh at 7:00 p.m. on September evenings:
This means someone with just one Powerwall could be making hundreds of dollars just by sending back a few kWh every night in September. There are a few other times during the year when it will also be worth returning energy with Powerwall, but the rest of the time most of the value will be in the Powerwall allowing homeowners to utilize their more own solar.
For these reasons, Tesla now says it will provide Powerwall with all of its own solar installations in California.
Tesla is also working with other solar installers in the state to supply its home battery.
The company predicts that solar plus Powerwall could result in savings of 92% on an average homeowner’s electricity bill in the first year:
Over 10 years, which is the period of a Powerwall warranty, this could result in savings of up to $15,000, or about the price of a Powerwall installation. Therefore, it essentially pays for itself while providing backup power capabilities and most likely still offering value after those 10 years.
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