IMPORTANT NOTICE: Beginning February 22, 2019, all applicants with inverter-based technologies submitting new interconnection requests under PG&E’s Rule 21 tariff will be required to comply with Smart Inverter Phase III Function 5 (Frequency Watt Mode –see Rule 21 Hh.2.l) and 6 (Volt Watt Mode - see Rule 21 Hh.2.m) functionality. For more information about this requirement, please review the FAQ below titled SMART INVERTER FREQUENCY WATT MODE AND VOLT WATT MODE REQUIREMENTS (2/22/2019).
All new NEM applications will be processed under the NEM Successor Tariff programs, NEM2, NEM2V and NEM2VMSH. Review the information below for more information about the NEM2 program.
If you have questions about your existing NEM1 system, review the frequently asked questions about NEM1.
PG&E recommends requesting a pre-application before submitting an interconnection application. For more information, download PG&E’s Pre-Application Report Request (PDF, 113 KB).
To learn more about electing the Cost Envelope Option during the interconnection process, download PG&E’s Generator Interconnection Cost Envelope Option (PDF, 249 KB)
NEM allows residential, commercial, and agricultural customers to install and interconnect a renewable generator, most often solar/photovoltaic (PV), sized to meet their annual load, and receive credits to offset the costs of their energy usage.
On January 28, 2016, the California Public Utilities Commission (CPUC) issued Decision D. 16-01-044 providing direction on the state’s Net Energy Metering Successor Program. The decision stated that once the 2,409 MW Cap for the original NEM (NEM1) program is reached, a NEM Successor (NEM2) program would take its place. Now that the cap has been reached, all new NEM customers must take service under the NEM2 program. Existing NEM1 customers who want to switch may also take service under the NEM2 program.
NEM1 programs affected by the NEM1 cap include:
These are collectively referred to as the "NEM2 Program."
PLEASE NOTE: Projects taking service on NEMFC and RES-BCT are not subject to the NEM Program Cap and are not part of the NEM2 program.
*Interconnection requests for modifying systems that have previously received Permission to Operate or for Standard NEM Aggregation fall under the “All Other NEM” process.
How to use PayPal to pay the application fee:
PLEASE NOTE: Single Family Affordable Solar Housing (SASH) customers who interconnect under the NEM successor tariff will not be required to pay the standard interconnection fee.
NEM2 applicants installing generating facilities larger than one megawatt:
The CPUC initially established rules for the grandfathering of Time-of-Use (TOU) time periods in Decision 17-01-006. On October 26, 2017, the CPUC approved Decision 17-10-018 regarding TOU period grandfathering, revising the earlier decision 17-01-006 issued January 19 (typos/error were corrected on 2/14/17 in Decision 17-02-017). For PG&E, Non-Residential (Commercial, Industrial, and Agricultural) Customers currently taking service on Net Energy Metering (NEM) or the NEM Successor Tariff (NEM 2), and those seeking to take service under NEM2 or any other Rule 21 tariff that includes the installation of a solar generating facility (e.g., RES-BCT) are affected.
Please note the following changes from this new Decision (D. 17-01-006):
New and Pending Interconnection Requests
Existing NEM Customers
*Expansion projects refer to projects that are requesting to modify a previously approved system. Any request to modify a previously approved system must apply through the ACE-IT portal.
On April 10, 2017, the California Public Utilities Commission (CPUC) approved Advice Letter 4983-E (PDF, 227 KB), updating the Rule 21 Tariff to include new requirements concerning inverter-based technologies seeking to interconnect to PG&E's grid. Based on the approved Advice Letter and in accordance with Section H.3.d. (Sheet 164) of the Rule 21 Tariff (PDF, 27.5 MB), all first-time interconnection applications received after September 8, 2017 must install "Smart Inverters."
"Smart Inverters" are inverters that are UL-1741 Supplement SA (UL-1741 SA) certified. A list of UL-1741 SA inverters are maintained on the California Energy Commission (CEC) website. For questions regarding certification of inverters as "Smart Inverters," the Solar Community is advised to work directly with the inverter manufacturers.
In an effort to assist Customers who were not able to submit interconnection applications prior to September 9, 2017, PG&E has filed a Tier 1 Advice Letter 5185-E (PDF, 8.0 MB) that grants additional provisions for non-Smart Inverter installation. Effective November 17, 2017, Applicants with non-Smart Inverter equipment may apply for interconnection as long as they meet one or more of the criteria below:
If a Customer's project meets either provision 3 or 4 above, the non-Smart Inverter details must be submitted via the appropriate interconnection portals as "Unlisted," and include either the electrical permit or the final signed-off permit dated prior to September 9, 2017. The project will not be able to advance into Engineering review until either the electrical permit or final signed-of permit is provided. NOTE: All non-Smart Inverter equipment must still be UL1741-certified. In addition, for Net Energy Metering (NEM) projects (including Virtual NEM and MASH), the non-Smart Inverter must still be listed on the CEC website in order to be eligible for a NEM program.
Starting July 26, 2018, the CPUC requires that PG&E only accept applications with UL 1741 SA compliant smart inverters with the default setting for Volt Var set to "reactive power priority" for interconnection requests utilizing inverter technology. To qualify, the inverters must be:
Clarification of Net Energy Metering (NEM) Applications
Although the inverter system is typically installed prior to submitting the interconnection application for NEM projects, new applications received starting July 26 must still include a qualifying inverter set for reactive power priority. Otherwise, the application will be rejected.
This Helps Everyone Win —Increased Safety and Reliability
When solar and other inverters export power to the grid, they need to raise the voltage at the inverter terminals to export power. With many generators on the same distribution line, the voltage during peak solar hours can be pushed above normal limits although this situation is not common. It is expected that smart inverters set to “reactive power priority” will help reduce the problem of inverters causing high voltage issues on PG&E’s distribution system for themselves and other nearby PG&E customers.
Work With Your Inverter Supplier
Most inverters are already capable or will be capable of setting Volt Var default to reactive power priority. Some Manufacturers may be making tools (for example "country codes" or profiles) available to set your project's inverter in the reactive power priority default mode. PG&E recommends that Developers work with their suppliers to plan for this upcoming deadline as soon as possible.
PG&E is compiling a list of inverters jointly with the other IOUs (SCE and SDG&E) capable of being set to "reactive power priority" as shown in the following spreadsheet (XLSX, 36 KB). This list will be maintained to assist Developers and Installers in knowing which inverters will be accepted beginning July 26, 2018. As an Installer, please contact manufacturers you source from to ensure they are complying with the instructions that PG&E and SDG&E provided so that your selected inverters are listed. Expect that for applications received on or after July 26, PG&E will verify the installed inverters are set with "reactive power priority" as the default setting.
PG&E anticipates that the California Energy Commission (CEC) will take over and continue maintaining this list at some point in the future. Until then, if there are questions about the inverters shown on the spreadsheet, please email NEMUpdates@pge.com.
About Reactive Power Priority
This new requirement comes after years of discussion at the Smart Inverter Working Group (SIWG) and the CPUC. Currently most inverters come with default settings for "real or active power priority." CPUC Resolution E-4920 and approved PG&E advice letter AL 5210-E modifying PG&E Electric Rule 21 establish the July 26, 2018 starting date, switching the default setting requirement to "reactive power priority".
Beginning February 22, 2019, all applicants with inverter-based technologies submitting new interconnection requests under PG&E's Rule 21 tariff will be required to comply with Smart Inverter Phase III Function 5 (Frequency Watt Mode –see Rule 21 Hh.2.l) and 6 (Volt Watt Mode - see Rule 21 Hh.2.m) functionality. Please review the Electric Rule 21 tariff for more specific information on this requirement.
The equipment list will be updated to only reflect currently compliant inverters, as listed on the California Energy Commission (CEC) website. If you believe that your inverter should be on this list, please work directly with the CEC to have it added. Note: Applications submitted to replace existing inverters may not be subject to this requirement, consistent with Rule 21 Section H.3.d.ii (unless further guidance on replacements is received from the California Public Utilities Commission).
Please note that PG&E reserves the right to inspect or assess your generating facility to ascertain compliance with these requirements. Non-compliant generating facilities may be removed from net energy metering, approval to operate (PTO) may be revoked and/or other actions undertaken as necessary to ensure the generating facility is compliant.
To be eligible for any of the NEM1 programs, PG&E must have received all of the following before or on the day the NEM1 cap was reached:
IMPORTANT NOTE: NEM1 eligibility is based on PG&E's receipt of the projects final inspection clearance as well as the other two items described above. Applicants who have not provided PG&E with the three items above, even if they have signed an agreement with a contractor or third party provider for solar installation, do not meet the eligibility requirements for NEM1.
When PG&E receives a completed application package with the required documentation referenced above, PG&E will review each application and deem it complete and ready for interconnection. Applicants will be notified of their completion status once their application is deemed complete. Notification will also include information on eligibility for either the NEM1 program or the NEM2 program.
Current eligible participants in the NEM1 program are “grandfathered” as follows: Customers may remain on their current NEM1 program from the date of the issuance of the “Permission to Operate” (PTO) letter from PG&E until the date of the customer’s first Energy True-Up in the twenty first (21st) year. For example, if a customer had a NEM1 PTO date in July of 2010, they would be eligible to stay on their current NEM1 program through their annual True-up in 2031.
If the renewable generator is modified or repaired during the "grandfathering" period, the customer will remain eligible only if the NEM1 system does not increase in size more than 10 percent of the generating capacity in the original PTO letter, or 1 kW, whichever is greater.
However, if the capacity increase is greater than 1 kW or 10% of the original approved generator capacity, whichever is larger, the customer cannot utilize the NEM1 program for the entire system. The customer would have the following two options:
The separately metered system is eligible to be grandfathered under the NEM2 program for the full 20 years. However, if the entire system takes service under the NEM2 program, it will be grandfathered under the NEM2 program beginning from the date of the issuance of the NEM1 PTO.
*This option is only available if the solar arrangement allows the added capacity to be separately metered.
If the renewable generator is transferred to a new owner, operator, or PG&E account at the original location, it will not lose eligibility for the original 20-year "grandfathering" period unless the previous customer either requested to be removed from NEM1 or elected to transition to the NEM2 program.