How does net metering work with solar?

Net metering allows solar homeowners to send excess electricity to the grid and receive credits on their utility bill. When your panels produce more than you use (typically midday), excess power flows to the grid. You draw on credits in the evening or on cloudy days. In most states, credits are valued at the full retail electricity rate.

How much money can I make with net metering?

Net metering credits offset what you would have paid for grid electricity, typically saving $0.12–$0.35/kWh depending on your state. On a 10kW system producing 12,000 kWh/year with $0.15/kWh retail rate, net metering credits could be worth $1,800/year if you export roughly half your production.

How does net metering work?

Net metering allows solar homeowners to send excess electricity back to the grid and receive a credit on their utility bill — typically at the full retail rate. At night or on cloudy days, you draw from the grid and use those credits. At year-end, many utilities true up your balance. Net metering policies vary significantly by state and utility.

Is net metering available in all states?

About 40 states have mandatory net metering policies. However, several major states including California (NEM 3.0), Nevada, and others have reduced export rates significantly in recent years. California's NEM 3.0 pays roughly 30% of retail rate for exports, making battery storage much more valuable. Always verify your local net metering rate before sizing your system.

Net Metering Calculator

Calculate your monthly net metering benefit — how much you save by consuming solar directly, how much credit you earn exporting excess power, and what your remaining utility bill looks like after solar.

Solar Production (kWh/mo)

Energy Usage (kWh/mo)

Retail Rate ($/kWh)

Buy-Back Rate ($/kWh)

About This Calculator

Net metering is the billing arrangement that makes rooftop solar financially viable in most U.S. states. When your panels produce more electricity than your home uses in a given moment, the excess flows back to the grid and your utility credits your bill — effectively running your meter backward. This calculator shows exactly how that math works on a monthly basis: how much solar you consume directly (saving at full retail rate), how much you export (credited at the buy-back rate), and what your actual utility bill becomes after netting everything out.

The gap between retail rate and buy-back rate is the key variable most homeowners overlook. In states with full retail net metering (like California historically, or New Jersey), every exported kWh earns full retail value. But many states now offer reduced buy-back rates — sometimes as low as avoided-cost rates near $0.04–$0.06/kWh — which means over-sizing your system and exporting large amounts is much less valuable than right-sizing to maximize self-consumption. This calculator helps you see exactly what your specific buy-back rate means in dollar terms.

To get accurate numbers, pull your last 12 months of utility bills and calculate your average monthly kWh consumption. For solar production, use your installer's simulation output or the Solar Energy Production Calculator on this site. Your buy-back rate should appear in your utility's net metering tariff, which is usually posted on their website — look for terms like "export rate," "avoided cost rate," or "net metering credit rate." Monthly grid charges (sometimes called customer charges or service fees) typically remain even with solar and represent the floor of your future monthly bills.

Net metering policy is changing rapidly — several states have moved to "net billing" or "value of solar" tariffs that pay less than retail for exports. Understanding your local policy and running this calculation before going solar helps you size your system optimally for your specific utility's rules rather than chasing maximum panel count.

Calculations based on NREL solar modeling data and industry-standard assumptions, built and maintained by the independent SolarToolsOnline research team.

Estimates only — not financial, tax, or legal advice. Verify important results with a licensed solar installer or financial professional before making decisions.