Maximizing Solar ROI: How POSH’s Battery Solutions Help Solar Owners Beat NEM 3.0 and Rising Tariffs
With California’s shift to NEM 3.0, solar customers face new challenges as they now receive credits based on wholesale rates, extending ROI timelines. POSH offers a strategic solution through battery leasing and DC coupling, allowing customers to store excess solar energy, optimize energy use, and avoid the need to switch to NEM 3.0. POSH’s system lets existing NEM 2.0 users expand their solar capacity by up to 20% without exceeding grid backfeed limits, helping mitigate rising tariffs while enhancing self-consumption. This approach allows customers to maximize solar ROI and empowers EPCs to deliver optimized, scalable energy solutions
When California transitioned from Net Energy Metering (NEM) 3.0 to the Net Billing Tariff (NBT) in 2024, it introduced significant challenges for prospective solar customers. Under the new tariff, customers who install solar systems no longer receive retail-rate credits for the energy their systems produce, which previously helped to accelerate the return on investment (ROI). Instead, NBT offers a paltry solar production credit, drastically reducing the financial incentive for solar adoption.
To achieve a better ROI under the NBT framework, new solar customers must now pair their systems with a battery to leverage energy arbitrage. This trend is compounded by recent regulatory approvals for substantial increases in business and agricultural tariffs, which have risen by 17-24% since 2023 and by an astonishing 85-150% over the last three years. These steep increases have negatively impacted customers with existing NEM 2.0 and original NEM 1.0 solar installations, eroding the value of their investments and undermining their expected ROI.
To address these challenges, both customers and EPCs need effective solutions that restore value and strengthen ROI. POSH offers a path forward with its innovative approach to directly DC-coupling solar installations with POSH battery energy storage systems (BESS), enabling customers to mitigate these impacts and enhance their energy outcomes.
DC coupling involves directly connecting PV to a battery without relying on a solar inverter. This configuration provides increased efficiency and enhanced flexibility for energy management, particularly for applications such as backup power or load shifting. With this setup, the battery can store solar energy as needed, ensuring non-export generation through our battery management system (BMS). By managing the back feed from DC-coupled solar panels, the battery unlocks new opportunities for both customers and EPCs.
Under the existing guidelines of Rule 21, DC coupling allows existing NEM 1 and NEM2 customers to add up to 20% more PV capacity to an existing site without exceeding the current regulatory limits. This approach ensures that the customer remains under the provisions of NEM 1 and NEM 2 rather than transitioning to the less favorable NEM 3, as there is no increase in back feed to the grid. This strategic solution allows customers to maximize the benefits of battery storage by offsetting evening peak electricity costs. Energy can be stored when rates are low and used during high-cost periods, offering a compelling financial advantage.
Additionally, the ability to increase on-site energy production through DC coupling helps customers mitigate the impact of rising utility rates. By leveraging this innovative approach, customers and EPCs can address growing challenges while optimizing both energy efficiency and return on investment.
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