If you use SCE, you are aware of how expensive electricity is. You may have also observed how many of your neighbors are using rooftop solar energy to lower their high electricity costs.
The typical SCE homeowner pays $200 a month for electricity. That comes to $2,400 a year. Adding solar panels to your home can reduce that expense by a ton, and the energy bill savings will pay off the upfront cost of solar in just over five and a half years.
SCE will credit you for any extra energy you produced if you use less energy in a given month than you use.
The first thing to do if you’re considering solar panels for your home is to educate yourself as much as you can. We’ll go over everything you need to know about going solar with SCE below. We’ll talk about the price of solar panels as well as savings, incentives, and batteries.
The Cost of Solar in Southern California
In California, a typical home solar system costs around $3 per watt of electricity produced. A Southern California homeowner with an average monthly bill of $200 would require a solar installation able to produce 4.6 kilowatts (kW) under full sun to meet all of their needs.
A typical solar system for a home in SCE territory would cost $13,800 before the federal clean energy tax credit and about $9,660 after the credit, assuming 4,600 watts at $3 per watt.
Since there are many businesses vying for your business in California’s mature solar market, you can typically find a range of prices from different installers who each use various brands of solar panels and other equipment. Because installation companies vary in experience, product quality, and warranty offerings, choosing the cheapest offer isn’t always the best option.
The best course of action is to compare several offers from various local solar companies, and before making a decision, make sure you ask the solar salesperson all the necessary questions.
Is Solar Worth It for SCE Customers?
The quick, simple answer to the aforementioned query is YES. The average homeowner in SCE territory can save an estimated $48,000 over 25 years AFTER they pay back their initial cost.
In the example above, the typical 4.6 kW system would pay for itself in roughly 5 years and 7 months. The solar panels would keep producing clean energy to power the house after it is paid off for 20 more years while still covered by warranty, saving the homeowner an estimated $48,000 along the way.
That’s a great deal! And if your average bill is higher than $200, you use more energy than most people do in a month and could stand to save even more with solar.
The Steps to Go Solar in SCE Territory
When you install solar panels on a home in SCE territory, these are the steps you follow:
- Get an estimate of how many solar panels you’ll need based on your average bill
- Ask local solar installation companies for quotes for your home
- Evaluate the quotes, read reviews of solar companies, and pick the best one
- Your solar installer designs your system and applies for permits to construct it and connect it to the grid (also known as ‘interconnection’)
- The solar company receives permission to install the solar panels and completes the installation
- A local inspector and SCE electrician come to your home to inspect the installation
- When everything passes inspection, SCE grants permission to operate (PTO), and you can flip the switch on your system to begin generating electricity
The first step is to determine how much solar power you’ll need and obtain installation quotes.
How Net Energy Metering Works?
You must be on a time-of-use (TOU) plan when you switch to solar. With a TOU plan, the amount you pay or receive in exchange for the energy depends on when you produce it or use it. The issue is that SCE’s TOU plans charge peak rates in the evening, long after your system has stopped producing energy.
SCE’s TOU Plans
There are three TOU plans available. When you switch to solar, SCE automatically enrolls you in the TOU-D-4-9-PM plan. Peak rates for that plan are from 4 to 9 o’clock in the afternoon. SCE also provides the TOU-D-5-8-PM plan, which has peak rates from 5 to 9 o’clock in the evening.
The last special rate plan offered by SCE is called TOU-D-Prime, and it is only accessible to those who own or lease electric vehicles or plug-in hybrid vehicles.
How Time-of-use Plans Affect Your Net Energy Metering Compensation
During the day, your solar system generates electricity. If you generate more energy than you use, you’ll be paid at the daytime TOU rate for the extra energy you use. Compared to what you pay in the evening, that rate is lower.
Therefore, if you used a lot of power during the high evening peak rate hours, even if you produce more energy than you consume, you might still owe more than you get paid. How that function is explained here.
Daytime vs. evening rates using TOU-D-4-9-PM as an example:
If you generate more energy than you use during the day, you are paid at the summer rate of 25 cents. You must pay a 40-cent evening rate. As a result, you would owe SCE 30 cents if you had an excess of 2 kilowatt-hours during the day but used 2 kilowatt-hours during the evening.
The peak rates are in the evening, so you must use the least amount of power possible in the evening to avoid losing any compensation from NEM 2.0 to the higher evening rates.
Home Batteries Are a Solution to High Evening TOU Rates
One way that California homeowners are “beating the system” is by installing home batteries. During those peak rate times, the batteries keep the house running. You can avoid paying high peak TOU rates as long as you don’t use up all of the battery power.
Systems with batteries can also power homes during blackouts. Both the federal tax credit and California’s Self-Generation Incentive Program (SGIP) are applicable to home batteries. You receive a reward from the program based on the installed kilowatt-hour capacity of your batteries.