Ben Zientara. Courtesy photo.


On March 26, 2025, members of California’s legislature introduced their latest attempt to strip away protections from California residents who have solar panels installed on their home, business, or school, a bill called AB942.  

If enacted, AB942 would alter the deal the state of California promised to early solar adopters, greatly reducing the benefits of solar for nearly 2 million people who already have solar panels installed with utility agreements promising 20 years of savings. 

The bill's sponsor, Assemblymember Lisa Calderon—who was elected while she was a top lobbyist for a utility company—is trying to claw back what the state promised to its residents. 

AB942 should not pass the Legislature, because it would harm the state’s earliest solar owners, force them to use a billing plan their system was not designed for, and set a terrible precedent of the government breaking promises it made to its citizens.

What is proposed in California Bill AB942?

The bill text of AB942, as it was amended on March 25th, would end net metering as of July 1, 2026 for all customer-generators (i.e., solar panel owners) who have had their solar panels for 10 or more years as of that date.

It would also remove net metering protections from any solar installation when the home is sold to a new owner, regardless of whether it has been 10 years since installation.

Introduced by Lisa Calderon, a California State Assembly member and former Edison International employee, the bill claims it will help reduce electricity costs across the state by making solar owners “pay their fair share”. 

The cost savings argument comes from a flawed study of the costs and benefits of rooftop solar panels conducted as part of the California Public Utilities Commission’s 2022 decision that brought about NEM 3.0 and a further analysis by the state’s Public Advocates Office that claims net metering has resulted in over $8.5 billion in excess utility payments by non-solar utility customers.

What are the old rules for net metering?

The state of California established its initial NEM program in 1996 to spur solar adoption. It was slightly revised in 2016 under NEM 2.0 to ensure new solar owners would contribute to important state programs. Both NEM programs were wildly successful, and the state now boasts more than 2 million solar installations. 

These NEM rules promise that anyone who signed up would continue receiving energy credits under the programs for 20 years. That 20-year timeline is tied to the solar installation and not its owner, meaning that anyone who buys a home with solar panels installed under a NEM agreement will continue to receive the promised savings for the full term. 

AB942 seeks to break these promises in the name of electric bill savings, but ignores the millions of bills that would increase because of it.

What will happen if AB942 becomes law?

If AB942 becomes law, around 471,000 solar owners will immediately be kicked off their NEM 1.0 plans on July 1, 2026. All told, there are around 1.78 million solar installations covered under the NEM and NEM 2.0 rules, according to state of California Distributed Generation Statistics (DGstats). Under AB942, solar owners would:

• Be forced to switch to a time of use electricity plan.
• Receive low-value credits for excess solar energy.
• Pay a monthly solar fee.

The vast majority of these solar installations are on single-family homes, and AB942 would significantly raise the energy bills of the families living in them.

The owners of solar panels under NEM 1.0 are currently allowed to take service under the standard residential rate plans available from the utility companies. Their solar systems generate energy over the course of the day, and all of it goes to reducing their cost to use grid power. 

Example based on a typical PG&E customer

Looking at California DGstats, the average installation size for residential systems installed before 2020 was around 5.8 kilowatts DC. SolarReviews analysis shows that these systems likely generate an average of around 9,000 kilowatt-hours per year in Pacific Gas & Electric territory. 

The owner of the solar system will save about 44.5 cents per kilowatt-hour on the E-1 rate plan under their initial NEM contract. At the rate of 9,000 kWh per year, that’s about $4,000 annually, or $333 per month.

If AB942 becomes law, these people will be kicked off of the residential rate plans they’ve been on for years and forced onto the new E-ELEC time of use plan. Under this plan, there is a new monthly fixed charge of $15 per month, rates that change based on the time of day, and greatly reduced compensation for any solar energy sent to the utility grid.

We estimate that the savings for a homeowner with a NEM 1 solar installation would be reduced by around $1,900 per year if they are forced onto the E-ELEC plan. Instead of seeing $4,000 per year in savings, the homeowner would see just $2,100 per year.

To put it another way, a person whose solar installation had been covering their entire electric bill would now see a bill for $158 per month, and that bill would increase with time over the next 10 years. The state had promised that the NEM program would cover these solar owners during those 10 years, and it should not break that promise. 

Final word

Reasonable people can argue whether the CPUC’s NEM 3.0 decision was a bad one or not, but there are certain inarguable facts in this case:

• California state law promised 20 years of coverage under NEM and NEM 2.0.
• The vast majority of solar systems installed under NEM and NEM 2.0 do not include energy storage.
• The NEM 3.0 program was designed to provide NEW SOLAR OWNERS with an incentive to pair their solar installations with energy storage, or face the penalty of lower energy export values. 
• Enacting AB942 would break the promises made by the state of California to its earliest solar adopters, forcing them into a rate plan and a solar compensation scheme that was not designed for the way their systems were installed. 

Passing AB942 would be a complete tragedy, and it should not happen.

Ben Zientara is a writer, researcher, and solar policy analyst who has written about the residential solar industry, the electric grid, and state utility policy since 2013. His early work included leading the team that produced the annual State Solar Power Rankings Report for the Solar Power Rocks website from 2015 to 2020.