Why Are My NEM Charges So High? Seven Things to Check

High NEM charges usually come down to one of three things: the household is using more electricity than the solar was sized for, the system is producing less than it used to, or more of your grid use lands in expensive evening hours than your exports earn back. Your NEM charges are the net of those, carried forward month by month until the annual true-up, so a small monthly gap grows into a large year-to-date number.

If you are not sure which plan your account is on, start with how NEM 2.0 and NEM 3.0 compare.

This page walks through seven causes in the order to check them, using PG&E’s own statements as the example. SCE and SDG&E bills use different layouts but the same logic. If you want the plain definition first, start with what NEM means on a PG&E bill.

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First, read the right number

A PG&E NEM customer gets two kinds of monthly paperwork. PG&E says the Energy Statement shows what you pay each month, while the Detail of Bill shows cumulative charges paid in your True-Up month. PG&E’s sample March 2026 statement defines year-to-date NEM charges as the total NEM charges from the start of your annual True-Up period, and says the monthly charge or credit is shown for information and reconciled at True-Up.

So a big NEM figure in month ten is not ten months of overbilling. It is the running balance. What matters is whether it grew faster this year than last. The statement’s chart of net energy by month is where you see that.

1. The house uses more than it used to

PG&E’s list of what affects a True-Up starts with the household: another person living there, large new appliances, an electric car or a pool. Any of those can turn a system that once covered the year into one that falls short. Compare total kWh imported and exported by month with the same months last year. A steady rise points to a new continuous load. A jump that starts in one month points to a specific purchase.

2. The system produces less than it did

On the solar side, PG&E names system size, roof orientation and weather. Production also falls when an inverter trips, panels get shaded by new growth, or a string goes offline, and none of that shows on the utility bill directly. Check your monitoring app against the installer’s original estimate. If production dropped, our guide to solar panels not producing enough covers what to check before calling for service.

3. Your imports land in pricier hours than your exports

This is the cause people miss. The CPUC says NEM 1.0 and 2.0 credits are applied at the retail rates you pay under your rate schedule, and residential NEM 2.0 accounts must be on a time-of-use rate. A kilowatt-hour exported at noon earns the midday price. A kilowatt-hour pulled from the grid during the evening peak costs the peak price. Your kWh can net to zero for the year while your dollars don’t.

SCE’s default NEM 2.0 schedule, TOU-D-4-9PM, names its peak window in the rate itself. Running the dryer, dishwasher, pool pump or car charger after 4 p.m. on a sunny day moves usage from the cheap side of that line to the expensive side.

4. Some charges can’t be netted away

The CPUC says NEM customers pay the same non-bypassable charges for public purpose programs, bond charges, nuclear decommissioning and competition transition as other customers. On NEM 2.0 those are billed on the net energy you draw in each metered interval, an hour for homes, so exporting later in the day doesn’t cancel them. On the net billing tariff they are billed on all imports.

Separately, since March 2026 PG&E’s Base Services Charge has replaced the Minimum Electric Charge. PG&E says it is about $24 a month for most customers, roughly $10 more than the old minimum, partly offset by lower per-kWh prices, and not eligible to be offset by generation credits. It is paid monthly, so it shows up even in months when your solar covers everything else.

5. You are on NEM 3.0, where exports earn much less

If your system was approved under PG&E’s Solar Billing Plan, the net billing tariff, the math changes. The CPUC says export credits there are usually lower than retail rates, and bills are due monthly. PG&E’s 2026 price sheet for customers who applied in 2025 or 2026 shows a weekday noon export in April worth about $0.0085 per kWh, generation and delivery together, against about $1.15 at 7 p.m. on an August weekday.

A system that sends most of its output to the grid at midday will show high charges against small credits. Using more solar at home during the day, or storing it for the evening, is the lever. The NEM 3.0 export rate breakdown shows the full pattern.

6. A community choice aggregator bills part of it

If a CCA supplies your generation, part of your solar billing sits with the CCA rather than PG&E. PG&E’s explainer notes that net surplus compensation may vary if you receive energy from a CCA, and its export price sheet says its generation credits apply only to customers with bundled PG&E service. Look for a CCA section on the statement before you conclude PG&E’s numbers don’t add up.

7. The system was undersized from the start

If the first true-up after installation was already high, compare the installer’s estimated annual production with your actual annual use before solar. A system designed to cover part of your usage will leave NEM charges by design. Credits don’t carry over forever, either: PG&E says any remaining credits reset to zero before the next 12-month cycle, and surplus energy is paid at net surplus compensation of about $0.02 to $0.04 per kWh.

What to do next

1. Compare this year’s monthly net usage chart with last year’s and circle the months that changed.
2. Check production in your monitoring app against the installer’s estimate.
3. Move flexible loads into sunny midday hours and out of the evening peak.
4. Confirm which tariff you are on, NEM 2.0 or the Solar Billing Plan, before judging the credits.
5. If usage grew for good, price added capacity or storage against your tariff’s expansion rules first.

For how the annual reconciliation itself works, see what a NEM true-up is. For non-solar causes of a high bill, PG&E customers can work through the PG&E high-bill checklist.