I am writing about these two State of California bills because they didn’t seem to get much press.
Starting on January 1, 2011 some Californians will be paid by the utility for the power that they generate with solar panels and windmills. AB920 was signed into law in October 2009.
AB 510 (signed into law in February 2010) raised the cap set on the number of homes and businesses that can take advantage of net energy metering. The cap went from 2.5% of the utilities total customer peak power demand to 5%.
The California Green Building Blog has good information, but I can’t find much on the rate structure. I have heard that electricity will be bought at the same wholesale rate that the utility would have paid other suppliers for electricity at that place and time.
This site has some purchase rate information for many of the utilities.
So if you own a good roof for solar or wind power but don’t use a lot of electricity yourself, this might be enough incentive to build your own electricity generation plant.
deedsdesign 
Thanks for the mention, Sarah. I don’t have much direct information regarding rate structure, but I do know that the compensation is based on a wholesale rate for energy. In other words, the energy is purchased by the utilities at the rate they would purchase energy from other energy producers. So, to a certain extent, your comment that energy “will be bought at the same rate that the utility would have charged for electricity at that place and time” is correct as long as it is what they would have charged to other wholesale purchasers (such as other utilities). Consumer-generators” (e.g. homeowners in the net-metering program) will get a watt for watt exchange for power they use/generate, but if consumer-producers produce more than they use, they are not compensated at the “retail” rate the utilities charge all homeowners for power. I tried to keep this short. I hope it makes sense. If not, feel free to comment below or contact me. Thanks again for your mention. I love your website and design! Steve (California Green Building Blog)
Hi Steve,
Thanks! I fixed that part in the post….as best I could.
Sarah
Here’s the latest from PG&E on this:
http://www.pge.com/mybusiness/energysavingsrebates/solar/nembilling/faq/
“What is the status of Assembly Bill 920?
On June 9, 2011, the California Public Utilities Commission (CPUC) approved the net surplus compensation (NSC) rate for net energy metering (NEM) customers who produce more electricity (kWh) than they use over their true-up period, usually 12 billing months. This payment was authorized by Assembly Bill 920 (AB 920). The NSC rate may fluctuate every month, as it is based on a rolling 12 month average of spot market prices. Based on current market prices, the rate would be approximately 4 cents per kWh.
Why is my AB 920 payment less than the credit shown on my monthly NEM statement?
The credit you see on your NEM statement is calculated using the full retail rate for energy. Several components go into this rate, including generation, transmission, distribution, and the funding of public purpose programs. When PG&E buys energy it pays a generator the wholesale rate for energy. Similarly, when you generate surplus energy, you will receive the wholesale rate for generation, like all other generators. The credit shown on your statement is calculated using the retail rate, which is higher than the wholesale rate because it takes into account several components in addition to the generation component.”
Thanks for the update Katy
I have two questions, in case you figured it out.
1) is there a limit to the number of customers who can sign up for this? (per AB 510)
2) what do you think this means?
“What will happen if I install a larger-than-necessary PV system?”
“The NEM solar program is designed to enable customers to offset usage, not generate surplus energy. In order to participant in the NEM program, you are required to install a PV system that allows you to offset your annual onsite consumption.”
Seems like you have a larger than necessary PV system if you are selling electricity back to the grid.