NEM, CGS+, and What Hawaii Solar Homeowners Need to Know

Hawaii homeowners with rooftop solar are split into two financial universes depending on when they connected. If you're on HECO's original Net Energy Metering (NEM) program — closed to new applicants since October 2015 — you're getting compensated at something close to retail rate for every kilowatt-hour you send to the grid. Everyone else gets a fraction of that.

That gap is the central fact of Hawaii solar economics in 2026. Everything else — whether to add a battery, whether to modify your system, whether to leave NEM or stay — flows from understanding it.

The Landscape: A Decade of Program Churn

HECO's solar programs have changed so often that many homeowners don't know which one they're on. Here's the timeline:

• 2001–October 2015: NEM. Hawaii's original net metering program. Full retail-rate credit for every kWh exported. Over 60,000 customers enrolled before it closed.
• October 2015–November 2017: CGS (Customer Grid-Supply). Replaced NEM for new customers. Export credit dropped to roughly half retail (~15 cents/kWh on Oahu). Filled its cap quickly.
• July 2018–present (legacy): CGS+ and Smart Export. New programs at lower rates. CGS+ credits all exports at ~10 cents/kWh. Smart Export credits only off-peak exports (4pm–9am) at similar rates — requires battery storage.
• October 2024–present: Smart Renewable Energy (SRE) Export. HECO's current program for new customers. Time-of-use export rates, no capacity limits, 7-year rate lock for new interconnections. CGS, CGS+, and Smart Export customers must transition to SRE Export within 7 years of their original contract date.

NEM and NEM Plus customers are explicitly exempt from all mandatory transitions. They don't have to do anything.

Current Programs: What New Solar Customers Get

If you don't have solar yet, or if you're on CGS+/Smart Export and transitioning, here's what the current HECO lineup looks like:

Smart Renewable Energy (SRE) Export — The Current Default

New customers enroll in SRE Export. The current Oahu rates (fixed through 2026) are:

Export rates update every 3 years. New customers get a 7-year rate lock — rates won't change for the first 7 years of your interconnection agreement. Unused annual credits expire at year-end (exception: BYOD Plus credits don't expire).

Pairing with a battery helps: shifting exports to the 5–9pm evening peak window gets you 32.9¢ instead of 13.5¢ on Oahu — more than doubling the value of each kWh exported.

Bring Your Own Device Plus (BYOD Plus)

HECO's current battery incentive program. Available alongside SRE Export. You commit your battery to provide grid services (dispatch during peak hours), and in exchange:

• $100/committed kW upfront (up to $500)
• $5/committed kW monthly for 10 years
• BYOD Plus export credits don't expire (unlike standard SRE Export)

Low-to-moderate income customers get an additional $100/kW upfront incentive (up to $500 extra). The commitment is 10 years total.

Why NEM Is Worth Protecting

HECO's current retail rate on Oahu is roughly $0.42/kWh. NEM customers get that rate credited against their bill for every kWh they export. Under SRE Export, daytime solar exports get 13.5¢.

The math matters. A 10 kW system on Oahu might export 800 kWh on a typical month. At NEM rates, that's a $336 credit. At SRE Export daytime rates, it's $108. That's a $228/month difference — nearly $2,700/year — for the same panels, same roof, same sun.

NEM customers who interconnected before October 2015 are grandfathered for 20 years from their interconnection date. If you went solar in 2008, your NEM protections run through 2028. If you connected in 2015, you're protected through 2035.

NEM Grandfathering Rules — The Exact Line

This is where it gets specific. NEM grandfathering is not unconditional. Certain modifications to your system can trigger a review, move you to NEM Plus, or — worst case — cost you the NEM agreement entirely.

What's Allowed Without Jeopardizing NEM

• Equipment replacement (same size or smaller): Replacing an inverter, panels, or other components without increasing system size by more than 1 kW (Oahu/Maui) or 100 W (Hawaii Island) typically requires only an amendment to your interconnection agreement. NEM status is preserved.
• Adding NEM Plus (non-export storage/panels): Existing NEM customers can add a second, separate system under the NEM Plus program. The NEM Plus system's output is used entirely on-site — it cannot export to the grid. Critically, adding NEM Plus does not affect your existing NEM agreement. Your original NEM export credits are untouched.
• Adding a completely separate battery not interconnected with the NEM system: A standalone battery system (like a Franklin Home Power or EG4 setup) that operates independently from your NEM solar system, with its own separate meter and interconnection agreement, does not interact with your NEM status. See the battery section below for details.

What Can End Your NEM Status

The specific thresholds per HECO's FAQ:

• Oahu and Maui: Adding more than 1 kW AC of capacity triggers the NEM Plus requirement (non-export only)
• Hawaii Island: Adding more than 100 W AC triggers NEM Plus

If you need more export capacity — not just more on-site generation — you can't stay on NEM. NEM Plus is the option, but it's non-export. If you want to export more and get credit for it, you'd be looking at transitioning to SRE Export, which means leaving NEM permanently.

NEM Plus — The Middle Path

NEM Plus is specifically designed for NEM homeowners who want to add capacity without losing their original agreement:

• Available only to existing NEM customers
• Can add new panels, battery storage, or both
• New equipment is configured as non-export (on-site consumption only)
• Your original NEM agreement — and its retail-rate export credits — continues unchanged
• Best for: NEM customers whose consumption has grown (EVs, additions, AC) beyond what their original panels offset

The Battery Question: Adding Storage Without Losing NEM

This is the most common question from homeowners who went solar 10–15 years ago. The panels are aging, rates are high, and a battery for backup power sounds appealing — but not if it costs you the NEM grandfathering that's worth $200+/month.

The good news: there is a path to add battery storage and keep NEM. The details matter enormously.

Option 1: NEM Plus with Battery (Non-Export)

The safest path. You add a battery (and optionally more panels) under NEM Plus. The battery is configured to serve your on-site load only — it won't export to the grid. Your original NEM solar system continues exporting and earning retail-rate credits.

This gives you backup power and on-site storage without touching the NEM agreement. The trade-off: the battery can't earn export credits. It absorbs your own solar production during the day and dispatches at night, reducing how much you buy from the grid — but it doesn't earn the SRE Export evening-peak premium.

Option 2: Separate, Independent Battery System

A second approach is installing a completely independent battery system — separate interconnection agreement, separate meter — that has no connection to your existing NEM solar system. Brands like FranklinWH and EG4 offer systems that can operate this way.

The logic: HECO's grandfathering protections apply to your NEM interconnection agreement. A separate battery system, with its own agreement, doesn't interact with that agreement. It's essentially a second customer energy system on the same property.

What HECO requires for this approach:

• A separate interconnection application through HECO's Customer Interconnection Tool
• The new system must charge from grid power or on-site generation that doesn't flow through the NEM meter — it cannot share the same metering configuration as your NEM system
• Permits through your county building department (standard electrical permit)
• Equipment must meet current technical standards (advanced inverter functions)

Does Adding a Battery Trigger Any NEM Review?

Adding a completely separate battery system under a new interconnection agreement does not automatically trigger review of your NEM status. HECO reviews what's in an interconnection agreement — if your NEM agreement is unchanged, your NEM status is unchanged.

What triggers review: any amendment to your existing NEM interconnection agreement that modifies the system configuration. Keep your NEM system untouched and under its original agreement, and you're protected.

The BYOD Plus Option (Forfeiting NEM)

There's a third path, but it involves leaving NEM: enrolling in SRE Export and BYOD Plus. You'd get the battery incentives ($100/kW upfront, $5/kW/month) and access to time-of-use export rates with evening-peak credits at 32.9¢. But you'd lose the retail-rate NEM credit for your solar exports permanently.

For most NEM homeowners with significant solar production, the math doesn't favor this. The NEM credit gap (retail rate minus SRE Export rate) typically exceeds any BYOD Plus incentive within 2–3 years. Run the numbers for your specific situation before considering this path.

Decision Frameworks

Framework 1: "I'm on NEM and want to add battery storage"

Framework 2: "I've never had solar — what program should I look at?"

Framework 3: "I'm on CGS+ — should I stay or transition to SRE Export?"

As of October 2024, CGS+, CGS, and Smart Export customers are being automatically transitioned to SRE Export 7 years after their initial contract date. If your contract started in 2018, you'll transition around 2025. If it started in 2019, around 2026.

The comparison:

For most CGS+ customers with a battery (or willing to add one), switching to SRE Export early can be worth it — especially if you can shift exports to the 5–9pm window. If you export mostly during the day and don't have storage, the daytime SRE Export rate (13.5¢) is only modestly better than CGS+ (10.1¢). Run your monthly export hour distribution before deciding.

Tax Credits and System Sizing

HECO rate programs aren't the only financial lever in Hawaii solar. State tax credits — specifically the RETITC under HRS §235-12.5 — interact directly with system sizing decisions in ways that most homeowners don't fully understand.

The RETITC provides a 35% credit on system cost, capped at $5,000 per 5 kW block — not per system. A 6 kW system qualifies for over $7,000 in state credits. If you're sizing a system and an installer recommends 5.5–6 kW when 5.0 kW would cover your usage, understanding the per-block credit math often explains why: the net cost difference after credits is much smaller than the gross price difference suggests.

The Bottom Line

If you're on NEM, protect it. The financial value — roughly $200+/month compared to new-customer rates — is real and locked in for 20 years from your interconnection date. Adding a battery under NEM Plus or as a completely separate system lets you get the resilience benefits without touching what you have.

If you're starting fresh, plan for storage. SRE Export is solid — the 7-year rate lock and TOU evening-peak rates (32.9¢ on Oahu) make solar-plus-storage genuinely attractive. The BYOD Plus incentive stacks on top. Budget for a battery from day one rather than adding it later.

If you're on CGS+, your transition is coming. The deadline is 7 years from your contract start date. SRE Export is generally better, especially with storage — but verify your export hour profile before moving early voluntarily.

Before any system modification, talk to HECO directly and get written confirmation of how your planned change affects your interconnection agreement. This is especially critical for NEM customers. Losing NEM grandfathering is permanent — there's no path back.

Rates and program details based on HECO's published SRE Export program (October 2024), HECO FAQ, and public PUC filings. Export rates are fixed through 2026 for current SRE Export periods. Hawaii Island, Lanai, and Molokai rates differ from Oahu — verify island-specific rates at hawaiianelectric.com. This article is for informational purposes; consult HECO and a licensed Hawaii solar contractor before making program decisions.