According to the latest preliminary data from the U.S. Energy Information istration’s Monthly Electric Power Industry Report, California residents are increasingly integrating battery storage with their solar installations. a4m1h

Since October 2023, the proportion of new residential solar photovoltaic systems paired with batteries has risen significantly. By April 2024, more than 50% of new residential solar installations included battery storage, compared to just over 20% in October 2023.

This shift is attributed to recent changes in California’s net metering compensation structure. Net metering, which credits customers for the electricity they return to the grid, was revised in April 2023 to a net billing tariff (NBT). The new variable compensation rate encourages the combination of solar s with battery storage, as batteries allow homeowners to store excess electricity and feed it back into the grid during peak demand periods, typically in the evening when solar output is lower.

Currently, solar installations with battery storage represent about 9% of all residential net metering capacity in California. Between October 2023 and April 2024, over 40,000 new installations were added, contributing 232 megawatts (MW) of new battery storage capacity to the state.

Household generators

Accordint to the EIA, the increasing amount of battery storage comes after California residents installed a record amount of solar capacity eligible for compensation from electricity utilities in the third quarter of 2023.

California residential solar capacity eligible for net metering increased by 22% in the third quarter of 2023 compared with the same period of 2022 as customers installed capacity before the compensation structure changed, EIA says. The rate of growth slowed in the fourth quarter, after the changes went into effect, but net metering-related capacity continued to increase. California now has more than 12,000 MW of installed solar capacity in residential net metering systems smaller than 1 MW.

Under the new NBT structure, the reimbursement rate varies throughout the day depending on when the solar electricity is generated. This rate is, on average, less than the earlier compensation structure known as net energy metering 2.0 (NEM 2.0), which credited generators at a flat retail electricity rate.

Capacity installations increased initially after the California Public Utility Commission announced a grandfathering scheme for NEM 2.0 customers for 20 years, which led to an interconnection application backlog during the first quarter of 2023, according to an analysis of the impacts of the new policy by the Lawrence Berkeley National Laboratory.

In California, residential units for more than 70% of the net metering installed capacity and approximately one-third of total solar capacity in the state. The new data shows that during the third quarter of 2023, 83,376 new residential net metering photovoltaic systems were installed, compared with 70,152 systems connected under the old NEM 2.0 rule during the same period in 2022.