NBT appears to be quite complicated. But it's quite easy to understand if you start with the three problems it is intended to help solve:
- Reduce oversupply of midday solar electricity
- Decrease peak hour grid load
- Increase peak hour availability of renewable electricity
NBT solves problem 1 by reducing the price PG&E pays you for surplus solar electricity during the time the sun is shining to less than $0.05/kWh – while they continue to charge you $0.29/kWh or more for electricity you use. You can no longer justify investing in a purely solar installation from the PG&E credits you earn.
NBT solves problem 2 by encouraging you to install a battery to capture your excess solar electricity during the day then to power your home during peak hours – from 4pm to 9pm. Electricity already stored at your home doesn't have to flow through the grid, thereby reducing the load on the grid. By using your own stored electricity you avoid paying PG&E their peak rates which average of $0.38/kWh year-round ($0.58/kWh from June through September).
NBT solves problem 3 by encouraging you to sell any stored electricity you are not using during the peak hours to PG&E at an annual average of about $0.21/kWh. The peak price PG&E is willing to pay can increase to more than $1.00/kWh during 6-7pm in August and September.
The cost of a solar + battery system is 60% to 100% more than just a solar installation. The payback analysis is complex because the rate structure is complex. Check out our
NBT Financial Analysis page for details.
The decision to retire the NEM2 tariff and replace it with NBT was controversial. Check out our
NBT Rationale page for an explanation.