SCE NEM 2.0 and the Solar Billing Plan: How Edison Net Metering Works

SCE NEM 2.0 is Southern California Edison’s older net metering tariff. If your solar application was in before April 15, 2023, your exports earn credits at retail rates and the account keeps that deal for 20 years from its Permission to Operate date. Newer SCE systems are on the Solar Billing Plan, SCE’s name for the net billing tariff people call NEM 3.0, where exports earn hourly credits that are usually far lower.

This guide covers who is on each SCE plan, the rate schedules each one requires, what ends NEM 2.0 early, and what the export numbers look like. For the statewide version of the comparison, see the NEM 2.0 vs. NEM 3.0 guide.

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Which SCE plan are you on?

The date your interconnection application was filed decides it. SCE says NEM 2.0 closed to new customers on April 15, 2023, when the Solar Billing Plan took effect, and that NEM 1.0 had closed to new customers in 2017. Customers who installed an eligible system after April 14, 2023 are on the Solar Billing Plan.

There was a tail for projects already in line. SCE’s FAQ says a NEM 2.0 application SCE had deemed valid had until April 14, 2026 to submit final documents and keep NEM 2.0 eligibility. That window has now closed.

Your bill and your interconnection approval letter show which program the account is on. If they don’t match what your installer told you, go with SCE’s records.

How SCE NEM 2.0 billing works

Solar you use at home offsets what you would have bought from SCE. What you export earns a credit at the retail energy rate for that time-of-use period, and the CPUC says NEM credits are applied at retail rates that include generation, distribution and transmission.

Residential NEM 2.0 customers must take service on a time-of-use rate. SCE says you are billed on TOU-D-4-9PM unless you choose another TOU rate you qualify for, and you can switch rates only once every 12 months.

NEM 2.0 also carries charges your credits can’t erase. The CPUC says NEM 2.0 customers pay non-bypassable charges on the net energy they draw from the grid in each metered interval, an hour for residential accounts. Charges and credits roll over for 12 months and settle at an annual true-up. If you exported more than you used over the year, the surplus is paid at the net surplus compensation rate, which the CPUC puts at about $0.02 to $0.03 per kWh.

SCE’s Solar Billing Plan (NEM 3.0) in brief

On the Solar Billing Plan, SCE says customers are on the TOU-D-PRIME rate, pay regular monthly charges, including taxes, fees and the Base Services Charge, and receive a settlement, or True-Up, bill once a year. Export credits cannot cover set charges such as the Base Services Charge. This section is the short version; for the rate, the export credit tables and the True-Up, read SCE’s Solar Billing Plan in full.

Exports earn Energy Export Credits that vary by hour. SCE says the values are fixed for nine years based on the year you began, and its export pricing page lists separate price sets for 2023, 2024, 2025 and 2026 applicants. Each has a delivery part and a generation part, drawn from the CPUC’s Avoided Cost Calculator. If a community choice aggregator supplies your power, SCE says to ask the CCA about generation export pricing.

SCE’s own 2025 examples show the scale. In summer it lists about $0.06 per kWh for daytime exports, $0.21 for the 4–9 p.m. evening window and $0.12 overnight. In winter it lists about $0.03, $0.09 and $0.10. Customers who enroll before 2028 also get a bonus of about $0.04 per kWh, or about $0.09 for income-qualified households. Those match the starting adders in the CPUC’s Decision 22-12-056, $0.040 and $0.093, which step down 20 percent at the end of each calendar year until they reach zero.

For context, the California Public Advocates Office put SCE’s residential average rate at 34.4 cents per kWh in June 2026, excluding the Climate Credit, in its Q2 2026 rates report. A daytime export worth a few cents is worth far less than a kilowatt-hour you avoid buying.

What ends SCE NEM 2.0 before 20 years

The main risk is expanding the system. SCE says NEM 1.0 and 2.0 customers who add no more than the greater of 1 kW or 10 percent of the original system size can stay on their program. A larger expansion moves the account to the Solar Billing Plan.

A battery by itself is treated differently. SCE says adding only an eligible new energy storage system does not affect the remainder of the 20-year NEM eligibility period, though it also says the capacity limits apply when storage is added to an existing installation. Get SCE’s written confirmation for your design before you sign. Our guide to adding a battery to existing solar covers the equipment side.

Selling or moving doesn’t restart or end the clock. SCE says moving in or out of a home with a NEM system, or transferring the account to someone else’s name, does not affect the NEM eligibility period of the original system.

What happens when the 20 years run out

SCE says the account continues on NEM until the 20-year period expires or the account loses eligibility, whichever comes first, and then moves automatically to the Solar Billing Plan or the successor plan available at that time. The CPUC adds that a customer moving to net billing from an earlier NEM tariff does not get net billing’s own nine-year legacy period.

SCE says NEM 1.0 closed to new customers in 2017, so the earliest SCE NEM 2.0 systems reach 20 years around 2037, and the last ones in the mid-2040s. The dedicated page on when NEM 2.0 expires shows how to find your own date and what to plan before it arrives.

What an SCE NEM 2.0 customer should check this year

1. Find your Permission to Operate date and write down the year your legacy period ends.
2. Confirm your rate schedule. If you are on TOU-D-4-9PM by default, compare it with the other TOU options SCE offers you, remembering the one-switch-per-year limit.
3. Read the true-up history. A rising annual balance usually means usage grew, production fell, or more of your use shifted into 4–9 p.m.
4. Before adding panels, measure the change against the greater of 1 kW or 10 percent of your original system.
5. If you are weighing a battery, price it for backup first; on NEM 2.0, exports already earn near retail.