Every claim on this page checked against primary sources on July 29, 2026

Net metering vs net billing

The label describes fewer states than you would expect

This page was written after reading the statutes, commission rules and filed tariffs of 12 states one at a time. The distribution was not what the vocabulary implies.

Of those 12 states, exactly one operates what would honestly be called net metering. Four operate net billing. Six of them — more than any other arrangement — do both at once inside a single monthly bill. And one has no net metering at all.

The hybrid arrangement is the one most people are actually on, and it has no common name, which is part of why it is so poorly understood. It works like this: within a billing period, everything you generate offsets what you consume at full retail value. Only what is left over at the end of the period counts as an export, and that surplus is paid at a lower rate. So you get net metering for the first portion of your production and net billing for the rest, and the split point is your own consumption.

Four rules that move the money more than the label does

These are the differences that turned out to matter most when we compared states, and none of them is captured by the words "net metering" or "net billing."

1. What happens to credit you do not use

Every state has to decide what becomes of a credit balance you never spend. We found four genuinely different answers, and the gap between the best and the worst is larger than most differences in export rate.

• It expires and the utility keeps it. Missouri credits expire "without any compensation" twelve months after issuance, or when you disconnect — whichever comes first, with no annual cash-out. Mo. Rev. Stat. § 386.890.5(4)
• It expires but the value is redirected. Maine eliminates unused kilowatt-hour credits at the end of each twelve-month rolling period — but the statute then requires each utility to remit the value of those expired credits to the state's low-income assistance programs rather than keep it. Me. P.U.C. Chapter 313
• It never expires. Alaska's regulation says credits "do not expire or otherwise revert to the electric utility" — no window, no forfeiture. 3 AAC 50.930(b)
• You get paid for it. Nebraska carries credits forward and then, at the end of each annualized period, pays out any remaining balance to coincide with your final bill of that period. Neb. Rev. Stat. § 70-2003(4)

Ohio sits in a fifth position worth noting: credits carry forward indefinitely and are never cashed out, but the commission's own consumer guidance warns they may be lost if you relocate or stop taking service — so an indefinite credit is not the same as a portable one.

This matters most where production is seasonal. A system that banks a large summer surplus to spend in winter is relying entirely on this rule, and in a twelve-month-expiry state a surplus you cannot spend inside the window is simply gone.

2. Whether the utility may charge you for having solar

This is the sharpest disagreement we found between states, and it is a straight contradiction rather than a difference of degree.

Nebraska's statute takes Alaska's side and names the same charges: a customer-generator may be charged the same minimum monthly fee as anyone else in their rate class "but shall not be charged any additional standby, capacity, demand, interconnection, or other fee or charge." Neb. Rev. Stat. § 70-2002(6)(a)

A recurring monthly charge calculated on the nameplate size of your array is a fixed annual subtraction from the savings, and it scales with the system — so it does not merely reduce the return, it changes the optimal system size. If you are comparing quotes across a state line, this is the first thing to check, and it is invisible in any figure described as an "export rate."

3. Whether the arrangement survives a house sale

Two states on this site answer this in opposite directions, and both answers are load-bearing for anyone who might move.

Indiana's grandfathered net metering tariffs may be continued by a successor in interest at the same premises, to the same end date — so a grandfathered Indiana system is a real asset to disclose when selling. Ind. Code § 8-1-40 Missouri goes the other way: on a change of ownership of the generating unit, the new customer-generator is responsible for filing a new application, subject to whatever the queue and the caps look like that day. Mo. Rev. Stat. § 386.890.7(2)

4. How often the netting is measured

The interval decides what counts as an export in the first place, and it can matter more than the rate applied to exports.

Georgia is the clearest illustration. Its earlier arrangement netted a month's exports against a month's consumption. Its current one nets instantaneously: "excess energy" means electricity delivered to the grid at any instant that exceeds what you are drawing at that instant. Because a solar array's output and a household's demand rarely match minute to minute, far more of your generation counts as excess under instantaneous netting than under monthly netting — at the same headline export rate. The Georgia page sets this out in full.

The general rule: the shorter the netting interval, the more of your production is treated as an export, and the more the export rate matters relative to your retail rate. Read the definition of the netting, not just the number attached to it.

So which is better?

Net metering, all else equal — and all else is rarely equal.

A state with net billing, credits that never expire and a statutory ban on standby fees can easily be a better place to own solar than a state with nominal net metering, a twelve-month expiry and a monthly capacity charge. The label tells you how one of the five or six relevant rules works. This site publishes the rest of them, per state, with the date each was checked.

The practical order to read them in, if you are evaluating a system:

1. What is my retail rate? That sets the value of everything I use myself, which is the largest term.
2. What fraction of my production will I use myself? In a hybrid state this is the split point between the two values.
3. What does the surplus earn, and how often is it measured?
4. What happens to credit I do not use?
5. Can my utility charge me a fee for having the system?
6. Does any of it survive if I sell?

The state pages answer these one state at a time, and each says explicitly what it has not been able to verify.

What this page does not cover yet

• Thirty-eight states. The comparison above is drawn from the 12 states with data files on this site, chosen for the launch rather than sampled for representativeness. The pattern it shows is real within that set; treat it as a description of those states, not a national statistic.
• What "avoided cost" actually equals anywhere. It is not one number or one methodology — it is set per utility, refreshed on different schedules (quarterly in Alaska, annually by formula in Indiana), and in California it is an hourly value with no single figure to publish at all. This page explains the mechanism and deliberately quotes no rate.
• Per-utility terms inside a state. Several states on this site have utilities that differ from one another, and the state pages say so; this page speaks at the level of the state rule.
• Community and shared solar, which is a different mechanism with its own crediting rules, and storage, which changes the self-consumption fraction that the whole hybrid analysis turns on. Both are queued as their own pages in this section.

Each of those is queued. When one is verified it will appear above with its own date.