Guide OverviewChapter 5 · California Policy — NEM 3.0 in Depth
Chapter 5 · California Policy — NEM 3.0 in Depth

5.8 How to upgrade a legacy NEM 1.0 / 2.0 system without losing grandfathering

California rule: expanding system capacity by more than the lesser of 10% or 1 kW forces the entire system onto NEM 3.0.

For legacy homeowners, this creates a deadlock:

  • The original system is too small (builder-installed ones are often only 4–5 kW).
  • They want a battery but want to keep NEM 2.0 export pricing.
  • Their original contract is PPA / Lease, so they have no authority to modify it.

The clean solution: install a completely separate Non-export system

  • The new system uses a CT clamp to power household load only and never exports.
  • The old system's NEM 2.0 grandfathering is not touched.
  • The old system continues earning 1:1 credits for what it exports. The new system covers whatever the old one can't.
  • California regulation explicitly permits this kind of "parallel but non-exporting" interconnection.

This is the only way to expand capacity without losing NEM 2.0 grandfathering.

Next Step

Questions after reading this section? Send us your utility bill — we will come back within one business day with a recommendation specific to your situation.

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