Data approachEIA rates · NREL sun hours · 2026 federal policy · methodology
If your rooftop solar panels produce more electricity than your home is using, the surplus flows out to the grid, and in much of the U.S. your utility gives you something for it. What you get is usually a bill credit rather than a check, and the value of that credit ranges from roughly the full retail price of electricity to just a few cents per kilowatt-hour (kWh). It depends on your state, your utility and, increasingly, on when you signed up.
Short answer: Yes, you can usually be compensated for excess solar power, but mostly through credits on your electricity bill. Under net metering, each kWh you export offsets a kWh you later buy from the grid. The rate used to value that export is set by your state regulator or utility, and it is the single biggest driver of how much your solar system saves.
Key takeaways
Net metering pays in bill credits; direct cash payouts are rare.
Export credits range from near the retail price to a few cents per kWh, depending on state and utility.
California (April 15, 2023), Connecticut (January 1, 2022) and Illinois (January 1, 2025) all changed the rules for new customers. Existing customers were generally grandfathered.
The 30% federal tax credit for homeowner-owned solar ended for expenditures after December 31, 2025, so your export rate matters more than it used to.
⚖️ Policy & Net Metering
How Net Metering Works: Credits, Billing and Rollover
When your panels produce more than your home uses in a given hour, the extra electricity flows to the grid through a bidirectional (or smart) meter. Your utility records those exported kilowatt-hours and converts them into a credit. At the end of the billing period, the credit is subtracted from the electricity you drew from the grid, for example at night or on cloudy days. If credits exceed your consumption, most utilities carry the balance forward to the next month.
Net metering is a state and utility policy, not a single federal program. Trackers also disagree on how many states have it because they define it differently: one commonly cited count based on SEIA data is 34 states plus Washington, D.C. with mandatory rules, while broader counts that include net billing reach about 38 states plus D.C. Look up your own state and utility in the DSIRE database and on your utility’s tariff page.
Participation is large and has grown quickly. According to the U.S. Energy Information Administration (EIA), utilities reported about 5.18 million residential net-metering customers in 2024, up from about 649,000 in 2014.
Data visualization
U.S. residential net-metering customers grew from 0.65 million in 2014 to 5.18 million in 2024. Rooftop solar accounts for nearly all of them. Source: EIA Electric Power Annual, Table 4.10 (Form EIA-861).
Chart summary: The number of U.S. residential customers enrolled in net metering grew roughly eightfold in a decade, from about 649,000 in 2014 to about 5.18 million in 2024, and rose about 12% between 2023 and 2024. The chart counts enrolled customers, not what each one earns, and it says nothing about the rate at which each customer’s exports are credited. That rate is what the rest of this guide covers.
Retail rate vs. export credit: why the rate matters
The rate used to value your exports is the most important variable. Under full retail net metering, each exported kWh earns a credit equal to the retail price of a kWh you buy. Under net billing or avoided-cost compensation, exports are credited at a lower rate, while imports are still billed at the full retail price.
The table below is an illustration, not a forecast. It shows what 3,000 kWh of annual exports would be worth at different rates. The two retail figures are 2024 EIA residential averages, and the two lower rates are hypothetical.
Export credit basis
Rate
Value of 3,000 kWh exported
Full retail, U.S. average (EIA, 2024)
16.48¢/kWh
about $494
Full retail, Massachusetts average (EIA, 2024)
29.35¢/kWh
about $880
Reduced credit (hypothetical)
8¢/kWh
$240
Avoided-cost style credit (hypothetical)
5¢/kWh
$150
Most utilities settle net metering accounts once a year. Leftover credits at that point may be paid at a low wholesale rate or forfeited, depending on the state, so it usually pays to size a system to your annual usage rather than to a large surplus. You can model your monthly credit balance with the solar net metering calculator. For system prices by region, see How Much Do Solar Panels Cost in 2026? Complete US.
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🗺️ State Rules
Net Metering Rules by State in 2026: What Changed
Rules differ sharply by state, and several large markets have moved new customers away from full retail credits. The table summarizes the rules for new customers in selected states. Existing customers in most of these states were grandfathered, so the terms they keep can differ from what a new customer receives today.
Retail-rate net metering for small residential systems
Monthly credits roll over; leftover credits at the annual true-up are paid at a lower wholesale rate. Regulators have been reviewing changes, so confirm current caps.
Connecticut
Residential Renewable Energy Solutions (RRES) program
Net metering closed to new enrollment for applications from January 1, 2022. RRES offers a buy-all or a netting option on a 20-year term. Legacy net-metering customers can stay at the retail rate until December 31, 2041.
Illinois
Supply-only net metering
Since January 1, 2025, new customers are credited for the supply portion of exports, not delivery charges. Customers who interconnected earlier keep full retail net metering.
Fixed-rate export programs; no full retail net metering
Net metering closed to new applicants in October 2015. Hawaiian Electric’s Smart Export program credited fixed rates of roughly 11 to 21 cents per kWh by island outside 9 a.m. to 4 p.m., but it closed to new participants on March 29, 2024. Check which programs are open today.
Some retail electric providers and utilities offer solar buyback plans; rates vary by provider.
In California, the Public Utilities Commission approved the Net Billing Tariff on December 15, 2022, and it took effect for new applications on April 15, 2023. Exports are now credited at values tied to the utility’s avoided costs and vary by hour, and analyses of the decision put the average cut at roughly 75% compared with NEM 2.0. That gap between a high retail price and a low midday export price is the reason storage has become a bigger part of California solar sales.
Florida deserves a caution rather than a rate. Net metering there is governed by Public Service Commission rules, and the legislature has tried to curtail it, for example with a 2022 bill that the governor vetoed. Because the rules could change, confirm the current terms with your utility before signing.
Data visualization
Hawaii residential electricity cost 42.86 cents per kWh in 2024, about 2.6 times the 16.48-cent U.S. average. This is the retail price, not the export credit. Source: EIA Electric Power Annual, Table 2.10 (Form EIA-861), final 2024 data.
Chart summary: Retail prices in 2024 ranged from 14.14 cents per kWh in Florida to 42.86 cents in Hawaii, against a U.S. average of 16.48 cents. Hawaii’s price was about 2.6 times the national average and California’s about 1.9 times, while Texas, Arizona and Florida sat roughly 9% to 14% below it. A high retail price raises the value of every kWh you use on site and, in a full retail net metering state such as Massachusetts, every kWh you export. In states where new customers earn less than retail, a high retail price also means a wide gap between what exports earn and what imports cost, which is why California and Hawaii homeowners often consider batteries.
📋 Key Insights
What Determines How Much You Actually Earn
Your annual solar value comes from two streams: electricity you use directly, and electricity you export.
Here is an illustration with hypothetical inputs. Say a system produces 10,000 kWh a year, 4,000 kWh are used on site and 6,000 kWh are exported, at the 2024 U.S. average retail price of 16.48 cents per kWh. Under full retail net metering, all 10,000 kWh are worth about $1,648. With a 6-cent export credit, the value is about $659 for the self-consumed kWh plus $360 for the exports, or about $1,019. The difference, about $629 a year, comes entirely from the export rate. This example ignores fixed charges, panel degradation and time-of-use pricing.
Four factors decide where you land:
Export rate. Full retail, supply-only, avoided-cost or fixed buyback. Read your utility’s actual tariff, not a state average.
Self-consumption. Solar used inside your home is valued at the retail rate you avoid, which is almost always more than an export credit outside full retail states.
System size versus annual usage. EIA reports that the average U.S. residential customer bought about 10,791 kWh in 2022, or about 899 kWh a month, but usage varies widely with climate and home size. Oversizing can leave you with surplus credits that are paid at a low rate or expire.
Production and timing. Roof orientation, shading and location change how much you generate and when. Under time-of-use rates, an hour of expensive evening electricity is worth more than an hour of cheap midday electricity. Use NREL’s PVWatts tool or the solar system size calculator to estimate production for your address.
🔋 Battery Storage
Net Metering vs. Battery Storage: Which Strategy Fits Your State?
Where exports earn close to the retail rate, the grid works like a free battery: you send surplus out when production is high and draw it back later at the same value. In those markets, a battery rarely pays for itself through bill savings alone, though it may still be worth it for backup power.
The math changes where export credits are far below retail or vary by hour. If a midday export earns a few cents while an evening kWh costs many times more, storing midday solar for use after sunset can capture more value. California’s net billing design was built with that outcome in mind. A battery also increases self-consumption and adds resilience during outages, and it hedges against future rule changes, since export policies can be revised for new customers.
Battery prices vary widely by capacity and installer, so compare written quotes against your projected bill savings. The Tesla Powerwall ROI calculator can help you compare the payback of storage with relying on export credits in your utility territory.
💵 Incentives
Is Solar Still Worth It in 2026 Without the Federal Tax Credit?
For most of the last decade, homeowners who bought solar could claim a 30% federal credit under Section 25D. The One Big Beautiful Bill Act (Public Law 119-21), signed July 4, 2025, ended that credit for expenditures made after December 31, 2025, with no phase-down. If your system was installed and operational by that date, you can still claim it on your 2025 tax return. The same date applies to batteries bought as part of a homeowner-owned system.
This has two practical effects. First, payback periods for systems bought in 2026 are longer than the figures in older guides that assumed the credit. Second, your export rate and your ability to use solar on site matter more, because they now carry more of the financial case.
Some households use a lease or power purchase agreement (PPA), where a company owns the system. The owner may claim a commercial credit and can pass some of the benefit through in lower monthly rates, but the terms, escalators and deadlines vary, so compare contracts carefully. Also check state incentives and your utility’s programs, which can still reduce cost. To see how these pieces combine for your address, run the solar payback calculator with your own electricity rate and export credit.
Sources and Methodology
Figures in this guide come from the sources below. Illustrative examples are labeled as such and use the cited EIA prices or clearly hypothetical rates. Net metering rules change often and vary by utility, so confirm current terms with your utility and installer. This guide is general information, not financial, tax or legal advice.
Direct answers for US homeowners — sized for a $150/month electric bill.
Usually not. Most utilities apply exports as bill credits that offset the electricity you draw later, and unused credits typically roll forward. At the annual true-up, leftover credits are handled differently by state and utility: some are paid out at a low wholesale rate, and others expire. In Massachusetts, for example, monthly credits roll over at retail value, while leftover credits at the annual true-up are paid at a lower wholesale rate.
It depends on where you live. Some programs credit exports at or near the retail price, while others use a lower avoided-cost or supply-only rate. California's Net Billing Tariff, which applies to interconnection applications from April 15, 2023, pays hourly avoided-cost values that analyses put roughly 75% below NEM 2.0 on average. Illinois has paid supply-only credits to new customers since January 1, 2025. Arizona utilities pay a set export rate well below retail. Check your utility's current tariff before you sign.
It is changing more than disappearing. Several states have moved new customers from full retail credits to lower export rates, including Connecticut in 2022, California in 2023 and Illinois in 2025. Existing customers are usually grandfathered. California's NEM 1.0 and 2.0 customers keep their tariff for 20 years from interconnection, Connecticut's legacy net-metering customers can stay at the retail rate until December 31, 2041, and Illinois customers enrolled before 2025 keep full retail net metering. Protections vary by state, so confirm them in writing before installing.
It can be, but the math is tighter. The 30% Residential Clean Energy Credit (Section 25D) does not apply to homeowner-owned systems when the expenditure was made after December 31, 2025. Payback now depends more on your electricity price, your utility's export rate, how much solar you use on site, and any state or local incentives. Lease and power-purchase-agreement customers may benefit indirectly if the system owner claims a commercial credit, but terms vary. Model your own numbers before deciding.
Not always. Where exports earn close to the retail rate, the grid acts like a free battery and storage rarely pays for itself through bill savings alone. Where export credits sit far below what you pay to buy power, as under California's net billing structure, storing midday solar for evening use can be worth more. Batteries also provide backup power. Compare installed-cost quotes against projected bill savings, because the federal credit no longer reduces battery cost for 2026 purchases.
$150/month electric bill by state
System size and payback vary by electricity rate and sun hours — see your state.
18.19¢/kWh — US average residential price. Source: EIA Electric Power Monthly, Table 5.6.B (year-to-date through July 2026), residential average retail price (July 2026) (EIA)
Solar production
4.5 peak sun hours/day × 0.82 system derate. Approximate state-average daily solar resource (peak sun hours) based on NREL solar resource data (NSRDB); not location-specific — use NREL PVWatts for an address-level estimate. (NREL PVWatts)
Installed price
$3.00 per watt before incentives. Blended 2026 US residential installed price used by this site; EnergySage marketplace reported about $2.60/W (mid-2026); full-market medians are higher.
Federal tax credit
$0 for homeowner-owned systems installed in 2026 — the 30% §25D credit ended Dec 31, 2025 (IRS)
Net metering
National blend — solar assumed to offset 75% of the bill (87% in full-retail net-metering states, 55–70% elsewhere).
Estimates only — not tax, legal or financial advice. Get at least three installer quotes and confirm incentives with your utility and a tax professional.