Net Metering

Net metering is a billing arrangement between solar homeowners and their utility company. When your solar panels produce more electricity than your home consumes, the excess energy flows back into the public grid. Your utility meter effectively “runs backward,” and you receive a credit on your electricity bill for that surplus power.

Net metering is one of the most important financial benefits of going solar. During sunny daytime hours, your panels often generate more power than you need; those credits offset the electricity you draw from the grid at night or on cloudy days. Policies vary by state — some states offer full retail-rate credits, while others have moved to reduced rates or time-of-use structures. As of 2026, over 40 states have some form of net metering policy in place, though the specifics of compensation rates and program caps differ significantly. Homeowners should check their state and utility policies before installing a solar system.