The California Supreme Court has taken up a lawsuit filed by the Center for Biological Diversity, the Protect Our Communities Foundation and the Environmental Working Group challenging the state’s new NEM 3.0 rooftop solar policy. The petitioners are asking the court to review whether the California Public Utilities Commission’s NEM 3.0 decision follows state laws requiring that net-metering policies help the rooftop solar market grow, especially in disadvantaged communities.

NEM 3.0 went into effect on April 15, 2023, and cut the compensation homeowners receive for feeding excess solar power to the grid by around 75%. A 2022 analysis by Wood Mackenzie predicted NEM 3.0 would halve California’s rooftop solar market by 2024. Internal research by the California Solar & Storage Association (CALSSA) found California was on track to lose 22% of its solar jobs by the end of 2023. 

In May of 2023, the Center for Biological Diversity and other petitioners filed a lawsuit against the decision, but an appeals court ruled in favor of the CPUC and upheld NEM 3.0. The groups now say the Supreme Court’s decision to hear the appeals court’s ruling is a chance to undo the damage and save solar.

“The court’s intervention is necessary to clarify whether the commission can disregard societal benefits in setting tariffs for residential rooftop generation and fulfill its obligation to promote rooftop solar growth in disadvantaged communities under the NEM statute,” said Environmental Working Group (EWG) General Counsel Caroline Leary.

Center for Biological Diversity Attorney Roger Lin told Solar Power World he expects court briefings to take at least the summer, after which point the court will schedule oral arguments.

“The Supreme Court’s decision is a ray of hope for rooftop solar at a time when plummeting installations and massive layoffs are wrecking this vital industry and jeopardizing California’s climate goals,” Lin said. “The Public Utilities Commission made a huge mistake that’s putting rooftop solar’s benefits out of reach for working-class families. But the commission isn’t immune from legal review, and I’m now a lot more optimistic that we can get back to a reasonable policy that helps California fight the climate emergency and environmental injustice.”

Updated at 3:33 p.m.