The California Public Utilities Commission put forward a proposed decision in 2023 that would sharply limit the value of rooftop solar on properties with more than one meter. Renters in apartment buildings, schools, and farms were among the groups most directly affected, and the proposal drew strong pushback from the solar industry and consumer advocates.

Background: How Multi-Meter Solar Works

California has long allowed properties with multiple meters to install a single rooftop solar system and share the resulting electricity and net-metering credits across those meters. Two mechanisms, Virtual Net Metering (VNEM) for multifamily properties and Net Energy Metering Aggregation (NEMA) for farms, schools, and similar properties, made that possible.

Under those rules, a landlord could put solar on an apartment building and allocate credits to tenants' electric bills. A school or college could spread the generation of one array across multiple buildings on campus. A farm could use a single system to offset pumping, lighting, and barn loads across several meters.

The Proposed Decision

The proposed decision from the CPUC set hard limits on how much electricity produced by rooftop solar could be self-consumed on multi-meter properties. Instead of allowing the property to use its own generation first and then sell the surplus, the proposal would have forced customers to sell most or all of their rooftop generation to the utility at a lower, wholesale-style rate, and then buy power back at higher retail rates.

In practical terms, that change would have undermined the financial case for installing solar on multi-meter properties. Payback periods would stretch out, savings for residents would shrink, and in some cases projects that would pencil under the old rules would not work at all under the new structure.

Who Would Have Been Hit Hardest

The solar industry and several consumer groups identified three categories of property owner as the biggest losers if the proposal moved forward as written.

Renters in multifamily buildings would have seen far less benefit from a landlord's investment in a shared rooftop system. Under virtual net metering, tenant bills are credited based on the system's output. Under the new structure, those credits would have been based on a lower sale rate, cutting tenant savings significantly.

Schools and colleges would have faced similar pressure. California has many campuses with on-site solar that serves multiple buildings, and the new rules would have reduced the value of each kilowatt-hour produced on those systems.

Farms, especially those using NEMA to spread generation across a set of meters for pumps, irrigation, and barns, would have faced the same economics. Small and mid-sized farms often rely on the net-metering credit to justify the upfront capital cost of a solar system.

Industry and Advocacy Response

California solar industry associations called the proposal discriminatory against renters, farms, and schools. A revised CPUC proposal for virtual net metering was released later in 2023, though solar advocates continued to argue that even the revised structure was worse than the prior rules.

The broader context mattered. The CPUC had already overhauled single-family rooftop solar through the Net Billing Tariff, widely known as NEM 3.0, which cut the value of exported solar by roughly 75% to 80%. The multi-meter proposal was, in effect, an extension of that cost-cutting approach to property types that had been treated separately under earlier rules.

Timeline and Final Action

The CPUC was scheduled to vote on the proposed decision in September 2023. Final action from the commission eventually blocked properties with two or more meters from directly using their rooftop solar energy in the way they could before. The industry continued to seek legislative relief, but a related bill that would have restored some rights for schools, renters, and farms was vetoed.

Impact on the Solar Market

California's residential solar sales had already dropped significantly after NEM 3.0 took effect. The multi-meter changes added pressure to the commercial and multifamily segments, leading to further slowdowns in installation, layoffs at installer companies, and a shift in project economics toward systems paired with batteries.

Battery-paired systems became more attractive because storing solar energy on-site for use during expensive evening hours now produces better returns than selling energy back to the utility. That dynamic changed how developers sized and priced new projects.

What Homeowners and Renters Can Do

Homeowners and property owners considering solar in California today need to pay close attention to how export compensation is calculated and to how their property's meter configuration affects eligibility for specific rate structures. Modeling the financial case with the current rules, not assumptions from earlier years, is essential.

Renters in buildings with existing VNEM-supported solar systems usually keep their current credit treatment for the life of the original system. New projects, though, work under the updated rules.

For homeowners in single-family homes, storage has become an important part of any new solar project. A system sized correctly for evening load, with enough battery to cover peak-rate hours, can still deliver strong bill savings. Multifamily owners evaluating new projects often now look at direct-ownership models where the building itself consumes solar output rather than relying on credit allocation across tenants.

Looking Ahead

California's rooftop solar debate is not settled. Lawsuits, legislative proposals, and potential future CPUC revisions all keep the rules in flux. What is clear is that the financial case for multi-meter solar became harder after the 2023 proposal, and that property owners need to run the numbers carefully before committing to a new install.

California Proposal Threatens Multi-Meter Rooftop Solar Installations