Does AB 942 End NEM Grandfathering?

AB 942 (Assemblymember Lisa Calderon) is a bill in California’s 2025–2026 session. Its latest version, dated July 17, 2025, is titled “Electricity: climate credits” — it is no longer a net-metering bill. The last recorded action was August 29, 2025: a Senate committee voted 5–2 “do pass” and sent it to the Senate Rules Committee, where it has stayed. It was never passed by the Senate, signed or vetoed.

The bill that circulated in early 2025 — and that most alarming articles describe — proposed three changes for customers of PG&E, SCE and SDG&E on legacy net metering (NEM 1.0/2.0):

1. Cut legacy NEM contracts from 20 years to 10.
2. Move a new owner who buys a home with existing solar onto the current tariff (NEM 3.0 / the Net Billing Tariff) instead of inheriting the seller’s NEM 1/2 terms — effectively ending the grandfathering on sale or transfer, from January 1, 2026.
3. End California Climate Credit payments to net-metered customers, also from January 1, 2026.

The first was dropped in the Assembly’s utilities committee in spring 2025; the bill passed the Assembly with the other two, which is where much of the “they’re breaking solar contracts” coverage comes from.

Sources: Canary Media — the clawback bill and its first amendment · Digital Democracy — earlier bill digest · verified October 6, 2026.

In the Senate, the bill was amended in July 2025. The version dated July 17, 2025 struck the remaining net-metering provisions:

• removed forcing a new home-owner onto the current (NEM 3.0) tariff;
• removed voiding NEM grandfathering on sale or transfer;
• removed the proposed new statutory section that carried those changes;
• removed the NEM-specific Climate Credit denial.

But — and this is the part often left out — the amendments did not remove every climate-credit change. The current version still proposes a different Climate Credit restriction: denying the California Climate Credit to customers who are not enrolled in CARE or FERA and whose total electricity bills for the previous year were less than $300. So the bill is now a climate-credit-eligibility measure, not a net-metering measure.

For scale: in 2026 SCE’s residential Climate Credit was $36 on the August bill and $36 on September’s. LADWP customers do not receive the Climate Credit at all, because LADWP is not regulated by the CPUC, so neither version of AB 942 would have touched an LADWP bill this way.

Sources: AB 942 bill text · Digital Democracy — July 17, 2025 digest · CPUC — California Climate Credit · CALSSA — Senate amendments protect NEM contracts · verified October 6, 2026.

If you own a home on NEM 1.0 or NEM 2.0: AB 942’s current text does not change your grandfathering when you sell, and the bill is not law. The widely shared “your solar contract will be voided on sale” claim describes an earlier version, not the current text or current law. Your legacy term still runs 20 years from your system’s permission to operate; see NEM 2 grandfathering.

Two honest caveats: (1) the current version still carries the separate Climate Credit restriction described above, so it isn’t accurate to say “nothing in AB 942 affects anyone”; and (2) although AB 942 itself has run out of time this session, lawmakers can introduce new bills on the same subject in the 2027–2028 session. This page addresses AB 942 only and is not legal advice about your specific tariff or transaction — confirm the current status and consult the utility or a qualified professional before acting.

For how net metering itself works, see NEM 2 vs NEM 3, NEM 3.0 explained, and selling a house with solar.

Because this is legislation, verify before relying on any summary. On California Legislative Information (leginfo.legislature.ca.gov), open AB 942 and check Bill Text, History and Status; Digital Democracy mirrors the same record with plain-language summaries. A signed (“chaptered”) date, a veto, or a new amendment would change this page — and for a future session, look for a new bill number rather than AB 942.

Figures on this page come from the primary sources below and, where noted, from Cali Energy calculations using the stated assumptions. Rates, incentives, and program terms change; each was verified October 6, 2026.

1. California Legislative Information — AB 942 (bill text & status)
2. California Legislative Information — AB 942 votes/history
3. Digital Democracy (CalMatters) — AB 942 status and bill digests
4. California Senate — 2025–26 legislative deadlines
5. California Constitution, Article IV (Assembly Clerk) — Sec. 10(c)
6. Canary Media — AB 942 net-metering clawback bill (May 8, 2025)
7. CALSSA — Senate amendments protect NEM contracts (July 15, 2025)
8. CPUC — California Climate Credit