BWP has a strategic objective of aligning rates with costs and balancing affordability and sustainability. NEM 1.0, the current rate program, overvalues the energy that customers export to the grid, and when BWP overpays for electricity, that cost is spread to non-solar customers. The overvaluation of energy due to NEM 1.0 is inherent to the structure of NEM 1.0, as NEM 1.0 uses a solar credit system, which means the value of solar energy equals the retail rate of energy.

For residential customers on the tiered rate, the rate is 14.71 – 22.49 cents. BWP has calculated the value of customer-generated solar energy, called the Avoided Cost of Energy (ACOE), and it is worth between 6.66 and 11.56 cents, depending on the time of day it is delivered to the grid. So, why is the ACOE less than the retail rate? It's because energy sent to the grid by solar customers doesn't carry the other costs to serve that the utility does.

Retail rates must cover everything that BWP provides to its customers – reliability, grid maintenance, billing, customer service, and all other operating costs. When a customer sends solar energy to the grid, it doesn't eliminate those additional costs to the utility. So, under the new rate, BWP will compensate customers for the cost that has been saved, which is the cost of the solar energy itself, plus its renewable attribute.

Therefore, to meet BWP’s strategic objective of aligning rates with costs, NEM must change. The solar net billing rate is the best option for meeting that objective, and it is aligned with industry best practices for developing a NEM successor program.

Yes, as an existing solar customer, you will be grandfathered into your existing NEM 1.0 rate structure. This does not exclude you from rate increases, but it will exclude you from moving to the solar net billing rate and program. Your grandfathering period will be 20 years from the launch day of the new Solar Net Billing program.

As long as a customer has applied for a permit before the date that the new program goes live, then the customer will be grandfathered into the NEM 1.0 rate.

Any change requiring a new interconnection agreement will end your grandfathering period. This includes a change in property ownership or upgrades to the system. Only upgrades that add to an existing system would require a new interconnection agreement, not routine maintenance. This includes adding additional solar panels that increase the system size, or adding new battery storage to a solar system. Replacing an existing panel with a panel of the same wattage, or replacing any broken parts like an inverter would not trigger a switch to Solar Net Billing.

There is no specific date for these changes to go into effect. As this program is not yet approved by the Burbank City Council, it will still need to go through that approval process. BWP must also complete some currently in-progress technology upgrades before it institutes the rate. The current estimate for approval and implementation of the new rate is in the March-June time range of 2025.

The current program allows customers to size systems to generate electricity up to 100% of their historical annual energy use. The proposed new program will allow customers to size systems up to 150% of their historical energy use, so customers should be able to generate enough electricity to cover their energy needs, and more, which could include future electric upgrades. In some cases, customer roof space may limit their ability to install a system large enough to cover annual energy use.