Beginning at the ring of the new year in 2025, Illinois will start to sunset its current Full Retail Net Metering program, to be replaced by the “Smart Solar Billing” program, which includes a few key changes on billing and pricing.
On and after January 1, 2025, all new solar customers in the state will be automatically enrolled in Smart Solar Billing. However, net metering is not disappearing – existing net metering customers will be considered “legacy” customers, and they will not be impacted by the change. Existing customers, or new customers who have filled out certain applications before December 31, 2024, will still qualify for Full Retail Net Metering.
Under the new program, credits will only apply to the supply portion of customers’ bills, instead of the entire bill. Smart Solar Billing also uses “Dynamic Supply Pricing,” which means export value will be based on time-of-use.
However, Smart Solar Billing customers will still have access to one-time use, upfront rebates, including the Distributed Generation (DG) Rebate and the Storage Rebate. The DG rebate, also known as the Smart Inverter Rebate, provides solar customers with an upfront rebate of $300 per kilowatt of capacity. The storage rebate offers solar customers who install battery storage an additional upfront rebate of $300 per kilowatt-hour of storage.
Solar Powers Illinois, a pro-solar campaign group, noted that those who wish to benefit from the sunsetting net metering program may not be able to meet the December 31 deadline for installation, due to “record levels” of homeowners installing solar, permitting processes, and other delays. Additionally, Ameren and ComEd can still reject submissions if they deem them incomplete or missing information, although utility approval is not required before the deadline.
Net metering was introduced to Illinois in 2008, although discussions have been ongoing for years about transitioning the program. As Solar Powers Illinois notes, net metering programs often start with “significant” incentives to encourage early adoption, with those incentives later reduced over time as adoption increases.
Outside of Illinois, net metering programs are seeing changes and opposition across the country. Last month, Appalachian Power Company requested a 70% reduction in net metering payments, arguing that the program shifts costs to non-participants. Current customers receive $0.16 per kilowatt hour, and although the utility said it would grandfather these customers for 25 years, it wants to reduce these payments for new customers to $0.04 per kilowatt hour.
Last year, Wisconsin utility MGE requested a change to its net metering program that would reduce payments from $0.16 per kilowatt-hour to $0.7 per kilowatt-hour. However, the Public Service Commission of Wisconsin unanimously decided to keep the existing program.
In perhaps the most notorious net metering news in recent memory, the California Public Utilities Commission (CPUC) made its decision on “NEM 3.0,” which has since rocked the state’s industry-leading residential solar market. In that decision, the CPUC began the process of sunsetting the state’s net metering construct in favor of an “improved version of net billing” designed to incentivize co-located energy storage.
The tariff applies to electrification retail import rates, with what it said would be “high differentials between winter off-peak and summer on-peak rates” to new residential solar and storage customers instead of the time-of-use rates in the current tariff.
It also replaced retail rate compensation for exported energy with Avoided Cost Calculator values that vary according to grid needs. The CPUC said that the high differential electrification retail import rates in combination with the variable retail export compensation rates provided by the Avoided Cost Calculator would send “strong price signals to customers” to shift their use of energy from the grid to mid-day and export electricity during the evening hours, which promotes the installation of storage with the solar systems.
Previously, Californians could save money by consuming rooftop solar power onsite and selling any excess back to the utilities at retail rates, further offsetting electric bills. This made switching to renewables a smart economic solution, especially for customers in low-to-middle-income communities.
