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Jan 08 2024
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NYC adopts solar friendly policies in 2024

NYC Embraces Residential Solar Power in 2024 with Groundbreaking Policies

By Solar Incentives by State, Solar Rebates & Incentives No Comments

With residential solar incentives eroding across the country, New York City is one of the few places in the US getting more solar-friendly in 2024 thanks to new zoning regulations and a huge upgrade to the city’s solar property tax abatement.

We get it – tax abatements and zoning regulations aren’t the sexiest topics in the world. But for NYC homeowners, they provide thousands of dollars in additional solar incentives and open up cast amounts of real estate for installing panels.

So, we checked in with T.R. Ludwig, CEO and Founder of Brooklyn SolarWorks and Brooklyn Solar Canopy Co., to see what’s new in New York City and what else is on the horizon.

What’s new with the NYC Solar Property Tax Abatement?

Beginning in 2024, the NYC Solar Property Tax Abatement (PTA) will be worth 30% of the installed cost of a residential solar and/or battery system, including solar carports. Previously, the abatement was worth 20% and did not apply to battery storage or carports. The PTA was also extended through 2035, providing property owners and the solar industry a sense of stability for this unique incentive.

Unlike a property tax exemption, which reduces a property’s assessed value, the abatement works as a credit against the solar owner’s property taxes. For a $25,000 solar system, the 30% abatement is worth $1,875 per year for four years, for a total incentive of $7,500.

For reference, at 20% the abatement would be worth a total of $5,000 for a $25,000 system.

20% abatement (installed before 2024) 30% abatement (installed 2024-2035)
System cost $25,000 $25,000
Year 1 credit $1,250 $1,875
Year 2 credit $1,250 $1,875
Year 3 credit $1,250 $1,875
Year 4 credit $1,250 $1,875
Total property tax abatement $5,000 $7,500

The PTA can also be combined with other state and local incentives in New York to substantially reduce the cost of installing solar and battery systems (as we’ll explore below).

TR Ludwig, CEO of Brooklyn SolarWorks and Brookly Solar Canopy Co

While the abatement only applies to the five boroughs of New York City, extending and upgrading the PTA required approval from both city and state government bodies, including a signature from Governor Kathy Hochul. As Treasurer of NYSEIA, Ludwig helped lead a ground-up effort to increase the PTA’s benefits and is already seeing positive impacts.

“This was no small feat – the 10% increase is huge and we created the same 10-year term as the federal solar tax credit,” Ludwig said. “It’s created a lot of interest and fervor in the market, and we’re already seeing other companies moving into New York City in a meaningful way.”

What do New York City’s updated zoning regulations mean for residential solar?

In December 2023, New York City passed the “City of Yes” zoning initiatives, including an amendment that relaxes zoning restrictions for residential solar installations and opens up vast amounts of real estate for residential installations.

“The main difference for rooftop solar is there were a lot of ‘no-go’ zones on a roof – most only flat roofs – where you couldn’t put panels or have them visible from the street,” Ludwig said. “That restricted solar system sizes quite a bit.”

The new zoning regulations abolish these restrictive setbacks and also allow solar panels to be used as accessory structures (aka canopies) over flat roofs, driveways, and backyards. By elevating solar panels above obstructions and fire access, canopies allow homeowners to access more roof space and build larger systems. Canopies also open up opportunities on the ground, such as NYC’s 8,500 acres of parking lots.

solar canopies provide levels that allow for more solar panels

“About half of Queens couldn’t do canopies because of zoning laws, now they can. Same with Brooklyn,” Ludwig said.

For property owners, more space for panels means greater opportunities for energy cost savings in an era of rapidly rising utility rates and electricity demand from electric vehicles and heat pumps.

“It essentially enables more electrification,” Ludwig said. “Even if someone already has panels on their roof, if they get an EV or heat pump and their load goes up, they can squeeze in more panels as a carport – literally park your EV under the panels that charge it.”

a solar canopy in park slope NYC

A solar canopy installed in Park Slope by Brooklyn Solar Canopy Co. raises the panels above obstructions and fire lanes.

Is solar worth it in New York City?

Thanks to high electricity prices and robust incentives at the federal, state, and local levels, New Yorkers can drastically reduce their electricity costs with solar panels. In addition to the new policies from NYC, residential solar systems may also qualify for:

  • A 30% tax credit from the federal government
  • A 25% tax credit (up to $5,000) from the state government
  • A 20 cents per Watt upfront rebate through NYSERDA
  • State sales tax exemption
  • 1:1 net metering

Here’s how these incentives add up for a 5 kW solar system with a sticker price of $25,000.

Item Amount
Sticker price $25,000
NYSERDA rebate -$1,000
Contract price $24,000
30% federal tax credit -$7,200
25% state tax credit -$5,000 (max)
NYC tax abatement (over 4 years) -$7,200
Net price $4,600

Altogether, the solar incentives available in NYC reduce the cost of this system by nearly 82% and the state’s 1:1 net metering policy provides full retail value for the excess solar production pushed onto the grid. Thanks to net metering, New Yorkers can effectively swap their ConEd electricity bill for low, steady payments on a heavily discounted solar system.

And that’s not to mention that electricity generated by residential solar is 12-20 times cleaner than kilowatts coming from the grid.

So, is solar worth it in NYC? Only if you like clean electricity and low, steady energy costs.

 

Jan 02 2024
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PG&E electric rates

PG&E Electric Rates in 2024: How to Lower Your Essential Electricity Costs

By How Do Solar Panels Lower Your Electric Bill?, The Pros and Cons of Rooftop Solar in 2026 No Comments

Serving over 5 million households in California, Pacific Gas & Electric (PG&E) is the largest investor-owned utility in the US. As such, when PG&E raises electric rates or updates its rate plans, households from Santa Barbara to Eureka feel the effects.

In this article, we’ll explore how much electricity costs for PG&E customers in 2024, the various rate plans and adders, and some frequently asked questions. Understanding how much electricity costs and the various ways to buy it can help you create a plan for lowering your electricity bill without sacrificing the comforts and perks of living in the 21st century.

Jump to a section:

Let’s start with a recap of PG&E electric rates today and where we can expect them to go in the near future.

What are PG&E residential rates in 2024?

The average bundled electric rate for PG&E residential customers is 45 cents per kWh as of January 1, 2024, according to the latest electric rate report. However, the cost per kWh of electricity ranges from 34 to 72 cents per kWh depending on your rate plan and the time of year.

In October 2023, the average electricity cost was 27 cents per kWh in California, according to the EIA. So, PG&E electric rates are:

  • Markedly above the state average
  • ~2.5 times the national average of 17 cents per kWh
  • Competing with San Diego Gas & Electric‘s rates for the highest in the country

In the bigger picture, PG&E electric rates have increased sharply in recent years, and are expected to continue increasing at around 10.4% per year through 2026, according to the 2023 Senate Bill 695 report filed by the California Public Utilities Commission (CPUC).

The chart below shows the average bundled residential rate at the end of each year from 2019 to the latest filing in 2023, as reported by PG&E, and the rates forecasted by the CPUC in the Senate Bill 695 report.

PGE bundled rates vs forecast 2024

The disconnect between the electric rates recorded through January 2024 (44.8 cents/kWh) and where they are forecasted to end up (36.6 cents/kWh) is likely due to varying data collection and reporting methods between PG&E and the CPUC.

PG&E’s data shows the average residential rate increased from 25 to 44.8 cents per kWh from 2019 to 2024 – a 79% increase in less than five years. Meanwhile, the Senate Bill 695 report forecasted nominal rates reaching 42 cents per kWh by 2026 after three more years of double-digit annual rate increases.

What’s the average PG&E rate hike?

Residential electric rates for PG&E customers increased, on average, 8.7% per year from 2014 to 2024. In just 10 years the average cost of electricity increased 25.4 cents per kWh, adding $152 per month to the electric bill of a homeowner using 600 kWh per month (around the state average).

For context, utility rates nationwide increased at an average rate of 2.3% per year during the same period– so PG&E rates are not only much higher, they’re rising nearly 4 times faster than the national average.

Year Average bundled residential rate (cents/kWh) Change from previous year (%)
2014 19.4
2015 20.3 4.7%
2016 22.0 8.3%
2017 23.1 5.1%
2018 23.3 1.1%
2019 25.0 7.4%
2020 26.3 5.1%
2021 28.6 8.7%
2022 33.8 18.1%
2023 38.2 13.2%
2024 44.8 17.2%
Average annual rate increase 8.7%

If we go back to 2008 — the oldest data available from PG&E — the average annual rate increase over the last 16 years is closer to 6% — twice the national average. With 6% rate hikes per year, an electricity bill would double every 12 years, which means a $200 monthly bill today would be a $400 monthly bill by 2036 and an $800 monthly bill by 2048.

So, with rates increasing at least through 2026, it’s worth considering all of the options for lowering your essential electricity costs. Let’s start by examining PG&E’s residential rate plans.

 

 

PG&E Tiered Rate Plan (E-1)

The first and most basic PG&E tariff schedule to consider is the Tiered Rate Plan, also known as E-1, in which the cost of electricity is dictated by your usage during the billing period.

For example, as of January 2024, electricity costs 42 cents per kWh until you reach your monthly Baseline Allowance, and then the price jumps to 53 cents per kWh.

PGE Tiered Rates Q1 2024

What is baseline electricity usage?

The Baseline Allowance is an allotment of essential electricity usage that is less expensive than the rest of the electricity used during a billing cycle.

For PG&E customers, the Baseline Allowance is based on four things:

  1. Your billing territory (P-Z)
  2. The billing season (Summer or Winter)
  3. Your heating service (all electric, basic electric, or gas)
  4. The number of days in the month

So, if you live in Santa Cruz (Territory “T”) and have basic electric service, your baseline allowance for summer months would be 6.5 kWh per day (based on this chart). In a 30-day month like June, that amounts to 195 kWh.

If you used 500 kWh during the month of June, the first 195 would be billed at 42 cents per kWh and the remaining 305 would be billed at 53 cents per kWh, putting your monthly bill around $207.

PG&E Tiered rates example bill

Usage Rate* Cost
Tier 1 195 kWh 36 cents per kWh $82
Tier 2 305 kWh 45 cents per kWh $162
Total 500 kWh – $244

*Based on Baseline Allowance of 195 kWh

According to PG&E, the Baseline Allowance is designed to be 50-70 percent of the average usage for each territory, so most Tiered Rate customers can expect to pay Tier 2 pricing for a substantial chunk of their electricity usage – which adds up quickly.

PG&E’s SmartRate™ Add-On

One way to lower your PG&E electricity rate is through the SmartRate™ add-on plan. In this plan, you essentially volunteer to reduce your electricity consumption during SmartDays™.

If you enroll in the SmartRate™ program, the trade-off goes something like this:

  • You’ll receive a credit worth around $0.008 (.8 cents) per kWh for all of your usage that’s not between 4-9 pm during billing periods that feature at least one SmartDay event.
  • When SmartDay events are called, you will be charged an extra 60 cents per kWh for all usage between 4-9 pm.

So, let’s say you use 500 kWh outside of 4-9 pm during a June billing cycle in which at least one SmartDay event is called. You would receive a $4 bill credit (500 kWh x $0.008) for being enrolled in the SmartRate™ program.

Now, let’s say you use 3 kWh to dry a load of laundry in the 4-9 pm window on a SmartDay event. That 3 kWh will cost you an extra $1.80 (3 kWh x $0.60). In this scenario, you would have to keep your SmartDay consumption below 6.67 kWh in order to break even for the month.

So, the SmartRate™ add-on is relatively high-risk and low-reward, but it can be added onto select rate plans to lower your electricity costs.

Speaking of rate plans… let’s take a look at the Time-of-Use (TOU) rate schedules that PG&E offers

PG&E Time-of-Use Rates 2024

PG&E offers two time-of-use rate plans as of January 2024, although some customers may be on legacy plans that are no longer offered to new customers. The current plans are known as TOU-C and TOU-D and there are some key differences to note.

  • The TOU-C plan has a Peak Pricing window of 4 to 9 p.m. and lower rates for usage below the Baseline Allowance
  • The TOU-D plan has a Peak Pricing window of 5 to 8 p.m. and does not have lower rates for usage below the Baseline Allowance

PG&E TOU-C vs TOU-D rate plans

TOU-C TOU-D
On-Peak hours 4 to 9 pm every day 5 to 8 pm only on non-holiday weekdays
Peak price (summer)* 62 cents/kWh 59 cents/kWh
Off-peak price (summer)* 53 cents/kWh 45 cents/kWh
Lower rates for Baseline Allowance? Yes No
Eligible for SmartRate™ add-on? No Yes
Summer months June-September June-September
Winter months October-May October-May

*Rates as of Jan 1, 2024 rounded to nearest whole cent and subject to change.

Let’s take a closer look at each plan.

E-TOU-C

Electricity rates in the TOU-C rate schedule range from 38 to 62 cents per kWh, based on the season, hour, and Baseline Allowance.

Customers in this plan pay 10.6 cents less for the kWhs in their Baseline Allowance. However, the tradeoff is a Peak pricing window that stretches from 4 to 9 p.m. and remains in place during weekends and holidays.

PGE TOU-C Rates 2024

The attractive feature of PG&E’s TOU-C plan is that you can pay as little as 38 cents per kWh under your Baseline Allowance during off-peak hours in the winter. So, if you have relatively low electricity consumption and the ability to avoid using electricity during the evening, then the TOU-C plan can help you pay less for electricity.

However, if you aren’t careful with your consumption, you’ll end up paying 62 cents per kWh for a hefty portion of your electricity!

E-TOU-D

PG&E’s TOU-D rate schedule is fairly straightforward. Off-peak electricity costs 45 cents per kWh in the summer and 46 cents per kWh in the winter with no credit for your Baseline Allowance.

Meanwhile, Peak rates are 59 cents per kWh in the summer and 50 cents per kWh in the winter, and are only in effect from 5 to 8 pm during non-holiday weekdays. That means that electricity consumption during weekends and holidays is billed using Off-Peak rates.

PGE TOU-D Rates 2024

With no Baseline Allowance, rates are actually a bit higher in PG&E’s TOU-D schedule. However, the shorter three-hour Peak window is easier to avoid (or stomach) than the five-hour window in the TOU-C schedule.

So, if you know your average electricity consumption is much higher than your Baseline Allowance, the short Peak window of the TOU-D schedule may prove the lesser of two evils, especially if you can shift consumption to Off-Peak hours and weekends.

 

 

PG&E EV rate plans 2024

While much cheaper and cleaner than fueling a gas car, charging an electric vehicle (EV) to drive 37 miles per day (the national average) adds around 300 kWh to your monthly electricity consumption. Given this extra usage, PG&E offers special EV charging rate plans that encourage customers to charge during Off-Peak hours to lower their costs and help stabilize the grid.

There are three PG&E rate plans to consider if you are charging an EV at home:

  • EV2-A is a plan that bundles your home and EV charging consumption into one rate schedule
  • EV-B separates your home and EV charging consumption into two rate schedules
  • E-ELEC is a plan for customers with high consumption due to home electrification upgrades like EV charging, battery storage, electric heat pumps (for water and/or climate control), and solar panels

Which PG&E EV charging rate plan is best?

EV2-A EV-B E-ELEC
Base charge? No No ~$15 per month
Separate meter for EV charging? No Yes No
Best time to charge 12 am to 3 pm 11 pm to 7 am 12 am to 3 pm
Worst time to charge 4 to 9 pm 2 to 9 pm 4 to 9 pm
Off-peak price* (summer) 34 cents/kWh 36 cents/kWh 42 cents/kWh
Eligible for SmartRate™ add-on? Yes No No
Summer months June-September (4 months) May-October (6 months) June- September (4 months)

*Rates as of Jan 1, 2024 rounded to the nearest cent and subject to change.

Let’s take a closer look at each plan.

EV-2A

The EV-2A rate schedule applies to both home and EV charging consumption and features the low Off-Peak rates of 34 cents per kWh year-round. Partial Peak rates run from 3 to midnight, with a 5-hour window of Peak rates between 4 and 9 pm.

In addition, the EV-2A plan currently has no basic monthly charge and is eligible for the SmartRate™ add-on.

PGE EV2-A rates 2024

PG&E’s EV-2A rate plan is most advantageous for customers who can shift their home and EV charging usage to the ample Off-Peak hours of midnight to 3 pm. For example, if you work from home and can do most of your heating, cooling, laundry, and EV charging in the morning, you may be able to buy most of your electricity at the relatively low price of 34 cents per kWh.

EV-B

The most notable feature of the EV-B rate schedule is that it requires a separate meter for EV charging, which means your home usage and EV charging are billed on different rate schedules.

The benefit of this plan is that you can charge your EV at 34 cents per kWh in the winter (the lowest rate offered by PG&E) and 36 cents per kWh in the summer during the Off-Peak hours of 11 pm to 7 am.

The drawback is that if you do need to charge during summer Peak hours, you’ll end up paying 72 cents per kWh (the highest price per kWh of any PG&E plan).

PGE EV-B rates 2024

PG&E’s EV-B plan is most advantageous for customers who can restrict their EV charging to overnight hours and have higher household usage than they can’t easily shift out of Peak hours. The idea is to combine a household rate schedule that has more forgiving Peak rates with the EV-B’s low Off-Peak charging rates.

E-ELEC

The E-ELEC plan is a jack-of-all-trades that applies to PG&E customers with one or more of the following home electrification upgrades:

  • EV charging
  • Battery storage
  • Heat pump water heater
  • Heat pump climate control

And, according to PG&E, all solar owners under the NEM 3.0 Solar Billing Plan will be transitioned to the E-ELEC rate schedule in December 2024 (although other messaging says December 2023).

The idea behind this plan is to pay a ~$15 basic monthly charge in exchange for rates that are lower, on average, the TOU-C and TOU-D plans, which can be quite advantageous for customers with high electricity usage.

For example, if you have a heat pump HVAC system, it’s likely cheaper to pay $15 per month in order to lower your winter Off-Peak rates to 37 cents per kWh instead of 46-49 cents per kWh in the TOU-C and TOU-D plans. (Pro tip: If you use more than 167 kWh per month to heat your home with a heat pump in the winter, the E-ELEC plan becomes more economical than the TOU-D plan.)

PGE E-ELEC Rates 2024

Frankly, the E-ELEC rate schedule may not be the best option for homeowners that only have EV charging and none of the other home electrification upgrades, since the Off-Peak rates are not as low as the other EV charging plans. However, if you have multiple home electrification upgrades – or solar under the Solar Billing Plan – this may be your best option.

 

 

PG&E solar rate plans

In April 2023, PG&E and California’s other major investor-owned utilities (SCE and SDG&E) adopted a Net Billing Structure affectionately known as NEM 3.0. While existing solar owners were grandfathered into their NEM 1.0 and NEM 2.0, new solar owners who applied for interconnection after April 14, 2023 are subject to the new Solar Billing Plan.

According to PG&E, solar owners under the Solar Billing Plan will be automatically transferred to the E-ELEC rate schedule in either December 2023 or 2024 (depending on which information you look at).

How much does PG&E pay for solar power?

The key feature of PG&E’s Solar Billing Plan is export rates (compensation for excess solar production pushed onto the grid) that are, on average, 75% lower than the price of buying electricity from the grid. These rates hover around 4-6 cents during the morning and early afternoon and can exceed $2 per kWh during certain peak windows in September.

For example, the chart below shows the E-ELEC import rates versus the NEM 3.0 export rates for August weekdays.

PGE NEM 3 vs E-ELEC 2024

Under this billing structure, solar owners earn between 6 and 7 cents per kWh of electricity produced during peak solar production hours of 10 am to 2 pm (hours 10-14) while paying 64 cents per kWh for electricity pulled from the grid during summer Peak hours when their solar production is winding down.

Clearly, buying for 64 cents and selling for 6.5 cents is not a great deal. However, using battery storage, solar owners can store and use their cheap solar production and virtually avoid interacting with the grid altogether.

Better yet, new consumption-only batteries designed specifically for this purpose cost roughly two-thirds of the price of traditional backup batteries.

Team up with an Energy Advisor to explore custom solar and battery solutions.

Solar + battery vs PG&E grid

Let’s say you are a PG&E customer. Does it make more sense to pay for solar and battery or buy electricity from the PG&E grid?

Well, the average solar system size on the solar.com marketplace for California is 7.8 kW solar system, which would produce roughly 10,800 kWh per year, or 900 kWh per month.

At $3 per watt (the average price point for a cash purchase on the solar.com marketplace) that solar system would cost $23,400, or $16,380 after claiming the 30% federal solar tax credit.

To store your solar production to use during nights and evenings, you’d need  ~6 kWh consumption-only battery storage. While battery prices vary, it’s realistic to expect a gross price around $8,500, or $5,950 after the 30% tax credit (possibly lower if you claim the SGIP rebate.)

That puts the net cost of your system at $22,330. The chart below shows how the cost of solar and battery stacks up against PG&E rates rising at 4% annually over the next 20 years (which is intentionally conservative).

Chart depicting the cost of solar & consumption-only battery versus buying electricity from PG&E in 2024

Over 20 years, electricity from solar and consumption-only battery is around 18-30% of the cost of buying electricity from the PG&E grid. Today’s batteries are warrantied for 10-15 years (and lasting much longer), so even if you need to replace your battery after 10 years, you’ve already saved nearly $40,000 – far more than what batteries will cost in the early 2030s.

Lower your electricity costs with solar

With above-average electricity rates (even for California), PG&E customers have a ton of potential to reduce their essential electricity costs. While choosing a PG&E rate schedule that suits your consumption habits can shave down your monthly bill, nothing is as cost-effective as providing your own electricity with solar panels and battery storage.

 

 

Frequently asked questions about PG&E electric rates

What is the new rate for PG&E in 2024?

The average residential electric rate for Pacific Gas & Electric (PG&E) customers is 45 cents per kWh, as of January 1, 2024. However, the cost per kWh ranges from 34 to 72 cents per kWh depending on the rate schedule, season, and time of day.

How much does PG&E pay per kWh?

In the Solar Billing Plan (known as NEM 3.0), PG&E compensates solar owners at an average rate around 8 cents per kWh. This is markedly lower than the average cost of 45 cents per kWh to import (or buy) electricity from the grid.

However, using battery storage, solar owners can store and use their own electricity to avoid buying and selling from the grid at unfavorable rates.

What are the cheapest PG&E hours?

Electricity is cheapest during the Off-Peak hours between midnight and 7 am in all of PG&E’s Time-of-Use and EV charging rate schedules. However, this Off-Peak window stretches from midnight to 3 pm in the TOU-C, TOU-C, EV2-A, and E-ELEC plans.

It’s worth noting that the cost of electricity does not change throughout the day in the E-1 residential Tiered Rate Plan.