Net metering vs net billing: read your utility tariff

The value of rooftop solar depends on what your utility does with electricity used at home and electricity sent to the grid. Net metering and net billing are broad labels, not interchangeable nationwide promises. Your provider, tariff, application date and billing period determine the actual treatment.

Follow the electricity before valuing it

Solar used onsite can reduce electricity imported from the grid. Exported electricity is a separate quantity and may earn a different credit. Under net-metering arrangements, eligible exports can offset imports within specified intervals; the tariff determines which charges are offset and how remaining credits are handled. Under net billing, exports are valued separately rather than automatically canceling imported kWh at the retail price.

Do not multiply every generated kWh by your average retail rate. Fixed charges, non-bypassable charges, credit restrictions and time-of-use rates can all matter. Annual production equal to annual consumption does not establish a zero bill.

California example: scope and enrollment matter

The CPUC overview describes the net billing tariff, also called the Solar Billing Plan, for PG&E, SCE and SDG&E customers applying for interconnection since April 15, 2023. It is not a rule for every California municipal utility, nor a reason to treat all earlier NEM customers as new applicants.

CPUC says export compensation usually differs from retail import prices and can exceed retail rates in some late-summer evening hours. It also describes required time-of-use plans and program-specific credit treatment. A flat export-price assumption is not a simulation of those hourly schedules. Confirm the currently applicable tariff and enrollment terms directly with the provider.

Worked example — teaching inputs, not a tariff

Suppose 900 kWh of solar production includes 300 kWh used onsite and 600 kWh exported. At an assumed avoided import price of $0.30/kWh and export credit of $0.05/kWh, the energy value is $90 + $30 = $120. Valuing all 900 kWh at the import price would overstate this scenario. These invented prices exclude fixed charges, timing, losses, taxes and other tariff conditions; they are not California rates.

A battery is a separate purchase decision

Storage may shift energy to more valuable hours, but purchase cost, conversion losses, reserve settings and available surplus determine the result. Higher self-consumption alone does not establish that a battery pays for itself. Use the battery guide and ask for a tariff-specific comparison.

The solar calculator accepts explicit assumptions for planning. It does not automatically apply your tariff or run an hourly TOU model.

Before you decide

• Obtain the tariff name, service territory and enrollment/legacy status in writing.
• Find the import and export rate schedules, including time windows and effective dates.
• Check credit rollover, expiration, annual settlement and whether credits can be paid in cash.
• Identify fixed, minimum, non-bypassable or production-based charges separately.
• Compare solar-only and storage scenarios with the same load data and documented assumptions.

Sources and review limits

• CPUC Net Energy Metering and Net Billing — applies to PG&E, SCE and SDG&E retail programs, not every California utility. Public text reviewed through a reader because direct access failed; a reader snapshot is not an origin-page hash.
• CFPB Solar Financing — published August 7, 2024; supports cash/loan comparisons and warnings about promised savings. Its historical tax-credit window is not current eligibility guidance.

Source review: 2026-09-24. This is our access/review date, not the publication date of every source. The California example is limited to the named CPUC-regulated utilities. Other providers and legacy customers need separate checks. Checklists are editorial buying questions, not individual tax or engineering advice.