In this article

A solar panel is displayed on a wall near signage at the entrance of the new Tesla Inc. showroom in New York.
Mark Kauzlarich | Bloomberg | Getty Images

While Tesla CEO Elon Musk has said he would prefer to stay out of politics, and that he opposes all subsidies, his electric car and solar business is asking employees to protest a policy proposal in California that would cut solar incentives in the state, according to company correspondence obtained by CNBC.

There are at least 1.3 million residential solar customers in the state today.

Among other things, the policy proposal would reduce payments made to solar customers in California for excess power that their systems generate and send back to the grid. It would also add monthly grid-connection charges for solar customers, effectively making rooftop solar more expensive for California residents.

If implemented, the proposed policy changes could make it harder for Tesla, and its competitors, to sell customers on a residential solar installation in the state or generate profits from systems it leases.

Proponents say that the proposed changes to California’s net energy metering policy would help more residents to install energy storage systems, like Tesla’s Powerwall or LG Chem’s RESU battery, at their homes through rebates, and bring renewable energy to low-income or polluted neighborhoods.

The Public Utilities Commission views current rates as a large subsidy for homeowners who are mostly well-off.

Solar power advocates have slammed the proposed policy changes, as CNBC previously reported, while the state’s largest utilities have voiced their approval.

Here’s what Tesla is telling its energy employees to do in response to the policy proposal (transcribed by CNBC):

Announcement – Net Energy Metering 3.0

Date: Dec. 22, 2021

NEM 3.0 is a proposal under consideration at the California Public Utilities Commission (CPUC) that reduces the benefit of going solar for customers of PG&E, SCE and SDG&E.

Talking Points

  • If adopted, the proposal would apply to new customers that submit interconnection applications to add solar [by] May 2022. It would also apply to existing customers on NEM 1.0 or NEM 2.0 after their system has been in operation 15 years.
  • Exported energy would be credited at wholesale rates (approximately $0.04/kWh)
  • Residential solar customers on NEM 3.0 would be required to pay the utility a new fixed charge of $8/kW per month, regardless of energy used. This comes to roughly $50-$60 per month for an average size solar system.
  • This proposal is not final and can can change in response to public feedback. The public can express their opinion to the CPUC by taking these actions:
  • Weigh in with the CPUC by submitting a comment to the Public Advisors Office.
  • Sign up to provide a verbal comment directly to the five commissioners at the CPUC’s next public meeting on January 13.
  • Join the Solar Rights Alliance and find out all the ways you can act to protect rooftop solar in California.
  • Save Our Solar Rally – San Francisco (CPUC Building) and Los Angeles (Pershing Square) January 13 at 11 a.m.
  • Tesla is working with our partners in the solar and environmental community to urge the CPUC and Governor’s office to adopt a more reasonable approach that doesn’t punish solar customers

— CNBC’s Pippa Stevens contributed reporting.