Virtual Net Metering
Virtual Net Energy Metering (VNM or VNEM) is a tariff arrangement that enables a multi-meter property owner to allocate the property's solar system's energy credits to tenants. The VNM tariffs were first piloted under the CSI Multi-family Affordable Solar Housing Program (MASH) as a means of providing equal and direct benefits of the solar system to low income tenants in an affordable housing complex.
Based upon the merits of the pilot, the CPUC authorized the expansion of VNM to the general multi-tenant market in Decision (D.)11-07-031 (see section 4.0). This decision directed PG&E, SCE and SDG&E to file advice letters proposing VNM tariffs for market rate properties, and included proposed cost recovery for VNM billing.
On December 8, 2011, Energy Division Staff hosted a workshop at the CPUC to discuss issues pertaining to the proposed VNM general market tariffs. On April 19, 2012 Energy Division issued Resolution E-4481 authorizing the large electric IOUs' VNM tariffs.
Historically, multi-tenant buildings with individual electric meters for each tenant faced difficulties installing distributed solar PV systems because of the problem of assigning the benefits of the generation to each tenant account. A system could easily be connected to a common area load or to an individual tenant, but if it was connected directly to multiple loads, there would be no way of ensuring equitable distribution of the generation. Some tenants would benefit more than others. Installing multiple systems, one for each tenant or load in the building, is cost prohibitive.
Virtual Net Metering (VNM) allows multi-tenant building owners to install a single solar system to cover the electricity load of both common and tenant areas connected at the same service delivery point. The electricity does not flow directly to any tenant meter, but feeds directly back onto the grid. The participating utility then allocates the kilowatt hours from the energy produced by the solar PV generating system to both the building owner's and tenants' individual utility accounts, based on a pre-arranged allocation agreement. The intent of VNM is to help tenants receive the direct benefits of the building's solar system, rather than all of the benefits going to the building owner.
VNM and the SOMAH Program
In accordance with Decision (D.)17-12-022, PG&E and Energy Division hosted a workshop on February 13, 2018 to discuss the IOUs' (SDG&E, SCE, Liberty Utilities Company, and PacifiCorp's) development of VNM tariffs for the Solar on Multifamily Affordable Housing (SOMAH) Program.
As stated in that Decision, the electric utilities were ordered to file a Tier 1 advice letter designating a VNM tariff for use by SOMAH participants by March 14th, 2018. The advice letter could modify an existing VNM tariff used for the program, such as that used by MASH participants, or may develop a new VNM tariff based on the VNM tariff used for the MASH program, as appropriate. More information and the finalized SOMAH VNM tariffs can be found on the SOMAH Program website here.