Alarming Trend, Utilities’ Aggressive New Solar Fee Campaigns
- maktinta
- Oct 13
- 3 min read
The landscape for residential and commercial solar in the United States is rapidly shifting, as utility companies intensify efforts to introduce new solar fees and alter compensation structures for solar customers. This growing trend poses significant challenges to project economics and requires the renewable energy sector to stay acutely informed and strategically responsive.
Utilities argue these changes are necessary to cover grid maintenance and ensure equitable cost distribution. However, industry stakeholders view many of these actions as deliberate attempts to curb solar adoption and protect traditional revenue streams, impacting the Return on Investment (ROI) for countless installations.

Utilities Where New Fees/Policies Have Been IMPOSED (Red on Map):
Utility/Regulator | State | Fee/New Structure | Details & Implementation Date |
Pacific Gas and Electric (PG&E) Southern California Edison (SCE) San Diego Gas & Electric (SDG&E) | California | Net Billing Tariff (NBT) / NEM 3.0 | Applies to new solar applications submitted after April 14, 2023. This drastically reduces the credit rate for exported solar energy (from retail rate to an "avoided cost" rate), significantly extending payback periods. |
All Major Investor-Owned Utilities (PG&E, SCE, SDG&E) | California | Income-Graduated Fixed Charge | Approved by the CPUC in May 2024. This is a monthly fixed charge that applies to all residential customers, including those with solar, and is dependent on household income tier. Effective Date: Late 2025 (SCE & SDG&E) and early 2026 (PG&E). |
Salt River Project (SRP) | Arizona | Increased Monthly Service Charge & Rate Changes (Demand Charges) | SRP utilizes Demand Charges for most solar customers. They recently approved additional changes: - Increased Monthly Service Charge (MSC): Effective November 2025, the MSC for typical single-family homes (including solar) will increase to $30 (or higher depending on previous solar plan). - Overall Bill Increase: Residential solar customers will see an average bill increase of 5.5%. |
Oklahoma Gas and Electric (OG&E) | Oklahoma | Time-of-Use (TOU) Rate for Solar | Solar customers are typically required to be on a Time-of-Use (TOU) rate plan, which includes high energy costs during specific peak hours (e.g., 2pm-7pm in summer), impacting solar savings by reducing the value of exports. |
El Paso Electric | Texas | Demand Charges | Imposed demand charges on solar customers. Charges based on highest 15-minute usage peak, making bills unpredictable without storage. |
LUMA Energy | Puerto Rico | Proposed $300 Interconnection Fee | LUMA has proposed a one-time $300 fee for all of its 167,000 customers with home solar panels for a "technical interconnection study." |
II. Utilities/Regions Where New Fees/Policies Are PROPOSED or Being CHALLENGED (Orange on Map):
Utility/Regulator | State(s) Pushing/Affected | Status | Notes for Engineers |
Net Metering Successor Tariffs (Reduced Export Credit) | Nevada, Virginia (Dominion Energy), Idaho (Mountain Power), West Virginia | Under Regulatory Review (Successor Tariffs being filed) | These proposals aim to replace traditional 1-for-1 net metering with lower compensation for excess power sent back to the grid (often near wholesale rates). Dominion Energy Virginia's proposed NEM 2.0 uses net billing with 30-minute intervals. |
"NEM 3.0" Clawback on Home Sales (AB 942) | California | Proposed/Under Legislative Review (Passed Assembly Committee as of May 2025) | This bill requires new homeowners purchasing a house with an older, more favorable Net Metering contract (NEM 1.0 or NEM 2.0) to be switched to the significantly less lucrative NEM 3.0 tariff, potentially devaluing solar assets upon property sale. |
Community Solar Monthly Fee | Maine | Approved/Scheduled to Start (January 2026) | A new law imposes a monthly fee on community solar owners to be paid to utilities, after community solar projects were made ineligible for net metering. This represents a direct charge on the solar owner to utilize the grid. |
Large Fixed Charge Increases | Multiple States (e.g., Connecticut, Michigan, Ameren in Illinois/Missouri) | Proposed/Under Review (Approved income-based fixed charges in California) | Utilities in various states are requesting significant—sometimes doubling or more—increases to the standard residential fixed monthly charge, impacting all solar customers connected to the grid. |
FEOC Restrictions (Federal Tax Credits) | Federal Policy (National Impact) | Going into effect (2026) with Guidance Pending | While not a utility fee, new federal rules related to "Foreign Entities of Concern" (FEOC) will disqualify projects from major tax credits if certain components are sourced from these entities. This will heavily affect commercial/utility-scale projects and increase project costs until supply chains are clarified and certified. |
The increasing complexity and cost associated with connecting to and utilizing the grid underscore the urgent need for strategic adaptation within the solar industry. From advanced energy storage solutions that maximize self-consumption to intensified policy advocacy, the path forward demands innovation and vigilance.
What are your thoughts on this escalating "grid war" and how should our industry best respond?
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