Solar Battery Storage, NEM 3.0 & Time-of-Use Arbitrage
With the transition of state utilities to Net Energy Metering 3.0 (NEM 3.0) and aggressive Time-of-Use (TOU) dynamic pricing, standalone solar without battery storage has seen its return on investment drop significantly. Pairing solar panels with home battery storage (e.g. Tesla Powerwall, Enphase 5P, FranklinWH) allows homeowners to perform rate arbitrage.
1. The Mechanics of Daily Rate Arbitrage
During peak solar generation hours (11:00 AM to 3:00 PM), grid export credits are now worth as little as $0.05–$0.08 per kWh under avoided-cost rules. Instead of selling cheap power to the utility, your battery stores surplus solar energy and discharges it during expensive peak evening hours (4:00 PM to 9:00 PM), when grid electricity costs $0.35–$0.60 per kWh.