Definitions of net metering, net billing, buy-all/sell-all and avoided cost, and who sets them
- NREL State, Local & Tribal Governments, Energy Compensation Mechanisms for Distributed Generation, page last updated 2026-02-20
Where the roof is
Home solar, state by state
The credit you get for exported power is set by state policy and utility tariff, not by the panels. The four mechanisms in use, and where to check yours.
Why does the same rooftop system pay differently in two states?
Because the credit you get for exported power is set by state policy and utility tariff, not by the equipment.
- No national rateFour different export-compensation mechanisms are in use, and the rate depends on which one your state and utility use.
- Set locally, not by the equipmentThe same rooftop system resolves to different money under a retail-rate credit versus an avoided-cost rate — a policy decision, not an engineering one.
- What this section is forRouting you to your state, and to the answers section for the national cost and production facts.
What these pages don't cover yet
Per-state law is a separate research pass, so the state pages behind this one are navigational and assert no rule we have not sourced. Solar Panel Answers connects you with licensed local solar companies. We are not a solar contractor.
Which parts of the decision does your state actually control?
Three decision-makers, and only one of them is in your state capital. Federal tax law is identical in all 51 jurisdictions. The compensation mechanism is a state policy choice. The tariff and the sell rate underneath it belong to the utility that bills you, which is why two utilities in one state can treat the same roof differently.
Federal
The same in all 50 states and DC
3- Residential Clean Energy Creditended for expenditures made after 31 December 2025
- Carryforward of a pre-2026 qualifying expenditureusable indefinitely until spent
- Nonrefundablethe credit never pays out beyond your tax liability
P.L. 119-21, enacted 4 July 2025; the carryforward rules were not changed (CRS IN12611).
State
Decided by legislators and regulators
3- Which metering and billing arrangements utilities may offer
- State incentives, rebates and exemptionsnot published here yet
- Interconnection and permitting requirementsnot published here yet
Policymakers either specify the arrangement or set principles for regulators and utilities to apply.
Utility
Decided by the company that bills you
3- The retail rate your credit is measured against
- The sell rate paid for exports under net billing
- Which tariff your account sits on
NREL names policymakers, regulators and utilities as deciding this collectively.
This is also why we publish no payback figure. The same system, on the same roof, with the same modelled production, resolves to different money under a retail-rate credit and under an avoided-cost rate — and that difference is a policy decision, not an engineering one.
Where do you look up your own state's rule?
DSIRE, run by the NC Clean Energy Technology Center at NC State, publishes summary maps for net metering policies and for distributed-generation customer credit rates for excess generation; both were last updated in May 2026. NREL's page on compensation mechanisms, last updated 2026-02-20, defines the four arrangements above.
Two illustrations of how far apart two states can sit, both quoted from an EIA article published in 2020 and dated here for exactly that reason. In New York, systems built before 2020 could sign net metering agreements paid at retail rates, while newer systems fell under the value of distributed energy resources framework, closer to the wholesale rate. In Arizona, new residential solar generation was valued on an avoided-cost basis — lower than retail rates but higher than wholesale, depending on the utility.
Those are 2020 statements about two states. Do not read them as current, and do not generalise them to a third state. We also do not publish a count of how many states mandate net metering: DSIRE maps it, we have not verified a number against the map, and an unverified count is exactly the sort of figure that gets repeated for years.
One more thing the map will not tell you, and a contract will. New York's Department of Public Service requires a residential solar contract to include an outline of system specifications or production warranties, and an estimate of annual energy output including the degradation of the system over time. That is a New York requirement rather than a national one — but it is a reasonable list of what to demand in writing wherever you live.
How much electricity does a household buy, and does that vary by state?
The average US residential customer bought 865 kWh a month in 2024, 2% more than in 2023, at 16.5 cents per kilowatt-hour and a $144 monthly bill. The state spread is the point: EIA's own headline is that residential bills in Hawaii and Connecticut are twice those in New Mexico and Utah, with Hawaii at $213 and Utah at $89.
- 865 kWhAverage monthly purchase per customer, 2024
- $144Average monthly residential bill, 2024
- $213 / $89Highest (Hawaii) and lowest (Utah) bills
- 16.5¢Average residential price per kWh, 2024
EIA attaches a caveat that matters more on a solar site than anywhere else: these are electricity purchases, not consumption. Net-metered PV systems effectively reduce purchases, so in states with many residential net-metered systems, household consumption may be a lot higher than household electricity purchases.
Which is the quiet reason a bill-based sales pitch travels badly across a state line. A bill is a tariff multiplied by a quantity, and only one of those two numbers is about your house.
Sources
Every figure on this page traces to one of these. Ranges are reported as ranges.
Retail versus avoided-cost rates, and the New York and Arizona examples
- EIA, Today in Energy, Lower compensation rates for residential solar PV generation could reduce overall adoption, 2020-03-25
Where current state rules are mapped
- DSIRE, NC Clean Energy Technology Center at NC State, Detailed Summary Maps, net metering map last updated May 2026
Federal credit expiry and carryforward
- Congressional Research Service Insight IN12611, 2025-09-25
- IRS, Residential Clean Energy Credit
Household purchases, bills and average price by state
- EIA, Today in Energy, residential bills by state, 2025-05-12
- EIA FAQ, How much electricity does an American home use?
Contract contents requirement, New York only
- NYS Department of Public Service, Consumer Guide to Rooftop Solar
Where the roof is
Home solar, state by state
What solar costs and whether it pays is decided state by state.
Tariffs, incentives and the rules on selling power back are set at state level, which is why the same roof is a good buy in one state and a poor one two borders away. Pick your state to see what applies where you are.
How it works
From “is it worth it?” to a number you can check
1
Start with your power bill
The kilowatt-hours you used over the last year is the number every honest quote is built from. Without it, any price is a guess.
2
See what the roof can actually make
Pitch, orientation and shade decide how much of that usage a system can realistically cover. This is the step door-to-door pitches skip.
3
Put the quotes on one basis
Cash, loan and lease are three different products. Compare system size and total price first, then compare the financing separately.
4
Matched with a licensed local company
The work is done by licensed local solar companies. We do not sell panels and we do not fit them.
How we work
What to expect from this site
Every figure here carries its source and the date it was checked.
Answer first, then the working
Each page opens by answering its own question in a couple of sentences, then shows the arithmetic underneath for anyone who wants to check it.
Ranges, not one confident number
Solar pricing moves with the roof, the state, the utility and the financing. A single national figure fits almost nobody, so we publish the spread our sources support.
We say when the maths does not work
A shaded roof on a low tariff can be a poor buy. That is a legitimate answer to the question and you will find it here rather than a reason to keep reading.
We are not the contractor
We do not sell panels and we do not fit them, so nothing here depends on you signing. Licensed local companies do the work.
Questions
Frequently asked
The questions homeowners actually ask before they sign anything.
Does net metering exist everywhere?
There is no national rule. Four arrangements are in use — net metering, net billing, buy-all/sell-all and avoided cost — and policymakers, regulators and utilities decide between them state by state. We do not publish a count of states with mandatory net metering, because we have not verified one against the DSIRE map.
What is the difference between net metering and net billing?
Net metering credits exported energy in kilowatt-hours, and full net metering values them at the same retail rate you pay for grid power. Net billing meters exports and credits them at a predetermined sell rate, which is lower, and banking kilowatt-hours within a billing cycle is not typically allowed.
Does the federal tax credit vary by state?
No. It was federal law and applied identically everywhere. P.L. 119-21, enacted 4 July 2025, ended the Residential Clean Energy Credit for expenditures made after 31 December 2025. A qualifying expenditure made before then can still carry unused credit forward until the whole amount is used.
Do you list each state's incentives and rebates?
Not yet. State incentives, interconnection rules and utility tariffs are a separate research pass, and nothing appears on a state page here until it has a source and a date. DSIRE publishes the current summary maps in the meantime.
Why is the page for my state so short?
Because it carries what is sourced nationally plus navigation, and nothing else. A state page padded with plausible-sounding local rules is the failure mode this site exists to avoid, so those pages stay thin until the per-state research lands.