Awaiting expert review. This page covers rules that vary by utility and jurisdiction. It is kept out of search results until a qualified reviewer has checked it; the sources below are dated so you can verify each point.
Quick answer
Net Billing is a solar compensation method in which the utility bills every kWh you import at its retail rate and credits every kWh you export at a separate, usually lower, export rate, with the two settled in dollars rather than netted in kilowatt-hours.
Because exports no longer cancel retail-priced imports one for one, the solar you use on site is worth more than the solar you send out, which favours self-consumption and batteries.
Quick facts
The key facts about net billing, with sources:
- Imports billed at
- The retail rate on your schedule
- Exports credited at
- A separate export or buyback rate set by the tariff
- Settled in
- Dollars, not kWh
- Measured
- Instantaneously or over a short interval, per the tariff
- Best-known example
- California’s Net Billing Tariff, for interconnection applications since 15 April 2023 2
- SC co-op example
- Palmetto Electric: $0.04662 per exported kWh (2026–27) 1
Key takeaways
- Net billing puts a price tag on each exported kWh. It does not let exports cancel imports one for one.
- You still pay the full retail rate for every kWh you take from the grid.
- Solar you use in the home at the moment it is made is worth the most.
- That makes batteries, EV charging at midday and right-sized systems more valuable.
- California, several South Carolina co-ops and city utilities use forms of net billing 2 1.
- The export rate can change, often once a year. Ask how long yours is fixed.
What net billing means
Under net billing, the utility keeps two separate counts. One counts the power you buy. The other counts the power you sell back. Each count gets its own price, and the bill shows the difference in dollars.
Palmetto Electric Cooperative in South Carolina describes it plainly. Energy you supply to the grid in a billing period is credited “by a monetary amount per kilowatt-hour,” which it calls its Value of Renewable Generation 1.
If the credit is larger than the bill, the leftover dollars roll to the next month while the account stays active.
The California Public Utilities Commission (CPUC) uses the same idea. Under its Net Billing Tariff, power sent to the grid is applied to the bill “at a rate reflecting the value of this generation to the grid” 2.
How one sunny afternoon is counted
- Panels make power → home uses it first (no meter charge, full value)
- Surplus leaves the home → meter counts it as export → credited at the export rate
- Evening → home draws grid power → meter counts it as import → billed at retail
- End of month → import charges minus export credits = your bill in dollars
How net billing works on your bill
Your utility fits a meter that measures power both ways. Palmetto Electric, for example, provides a standard meter that measures flow in two directions 1. The meter records imports and exports in short steps. Some tariffs count every instant. Others sum each 15 minutes or each hour.
Timing matters here in a way it does not under classic monthly net metering.
Under net metering, a kWh sent out at noon cancels a kWh bought at 8 p.m. Under net billing, the noon kWh earns the export rate. The 8 p.m. kWh costs the retail rate.
The gap between those two rates is money you keep only if you use the noon power yourself.
On the bill you may see lines such as “energy delivered,” “energy received,” “export credit” or a named credit like Palmetto’s Value of Renewable Generation. Leftover credit is usually carried in dollars, not kWh.
Sources: [1]
Types of net billing you may meet
| Design | How exports are priced | Example |
|---|---|---|
| Flat export rate | One rate per exported kWh, often reset yearly | Palmetto Electric’s yearly credit 1 |
| Time-of-day export rate | Different rates for on-peak and off-peak exports | Greer CPW rate code 750 4 |
| Avoided-cost rate | The utility’s cost to buy or make the power another way | See avoided cost |
| Hourly value rate | A rate that changes by hour and month, based on grid value | California’s Net Billing Tariff 2 |
Worked example: 400 exported kWh on Palmetto Electric
Palmetto Electric Cooperative (South Carolina) credits exports at $0.04662 per kWh for 2026–27 1. Take 400 kWh exported in a month.
| Treatment | Math | Value |
|---|---|---|
| Net billing credit | 400 × $0.04662 | $18.65 |
| Same 400 kWh used in the house instead | 400 × the retail energy charge on your schedule | Retail × 400 |
The gap between the two rows is what a battery or shifted daytime use can capture. Excess dollar credit at Palmetto rolls over month to month 1. Use your own schedule's energy charge for the second row; we do not print Palmetto's retail rate here.
Where to find the numbers on a net billing tariff
- The export credit per kWh, and whether it is fixed, seasonal or by time of day.
- How often it is reset, and whether existing customers are locked in.
- The measurement interval: instantaneous, 15-minute, hourly.
- Whether leftover dollar credit rolls over, expires or is paid out.
- Application, metering and monthly charges for solar customers.
- Your proposal: check that the installer used this export rate, not the retail rate, for exported kWh.
What net billing means for a solar buyer
Works in your favour
- Clear, published price for exports.
- Rewards batteries and daytime loads such as EV charging.
- Easier for utilities to keep offering, so programmes tend to stay open.
- Dollar credit is simple to read on the bill.
Works against you
- Oversized systems earn little on surplus.
- Payback is longer than under retail netting for the same system.
- Export rates can be reset, often yearly.
- Savings depend on when you use power, which is harder to predict.
The limits of net billing
The main limit is value. Every exported kWh earns less than a kWh you buy, on most net billing tariffs. A home that is empty all day exports most of its midday solar. That home gains less from panels alone than it would under net metering.
The second limit is change. Palmetto’s rate rose from $0.04329 in 2025–26 to $0.04662 in 2026–27 1. Rates can also fall. Check whether your rate is locked and for how long.
The third limit is complexity. Savings now depend on your daily routine, your rate plan and the export rate. A single “savings per year” number on a proposal hides those moving parts.
How net billing changes cost and payback
Net billing does not change the price of panels. It changes what each kWh earns, and so the payback time. For installed prices see cost per watt.
Three drivers matter most. First, the share of solar you use on the spot. Second, the gap between your retail rate and the export rate. Third, the fixed monthly charge, which no credit removes. A battery adds its own cost and its own losses; see round-trip efficiency.
A smaller system that matches your daytime use can pay back faster than a larger one under net billing. That is the reverse of the old advice to size panels to your whole year’s use.
How you end up on net billing
You rarely choose net billing. Your utility’s tariff applies when you connect. The usual order:
- Your installer checks which solar tariff the utility offers new customers.
- The installer sizes the system and files the interconnection application.
- Your local building department permits and inspects the work.
- The utility installs a two-way meter and grants permission to operate.
- Your first full bill shows import charges and export credits as separate lines.
If the utility offers more than one option, ask for a side-by-side estimate before you sign.
Getting the most from net billing over time
- Run big loads, like laundry, the dishwasher or EV charging, while the sun is up.
- Check each bill’s export line against your monitoring data.
- Watch for the yearly export-rate update and rerun your savings when it changes.
- If you add a battery, set it to cover evening use rather than to export.
Warning signs on a net billing quote
- The proposal values exports at the retail rate. That overstates savings under net billing.
- The system makes far more than your daytime use, with no battery or plan to shift loads.
- No one can tell you the export rate or when it is reset.
- A battery is sold for bill savings without a calculation that includes its losses.
Who sets net billing rules
No federal law requires net billing. The federal PURPA standard speaks only of net metering, which each state could adopt or not 5. So net billing comes from state commissions and from the boards of co-ops and city utilities.
California is the best-known case. The CPUC moved new customers of its three large investor-owned utilities to the Net Billing Tariff for interconnection applications from 15 April 2023, under Decision D.22-12-056 2. Older net metering tariffs are closed to new enrollments.
In South Carolina, Act 62 of 2019 (SC Code Title 58 Ch. 40) governs the investor-owned utilities’ Solar Choice tariffs 6. Co-ops and city utilities set their own terms, which is why Palmetto, Greer CPW and Rock Hill use dollar-based credits.
Net billing vs net metering
| Net metering | Net billing | |
|---|---|---|
| What is netted | kWh in against kWh out over the period | Dollars: import charges minus export credits |
| Value of an exported kWh | Usually retail, until net excess | The export rate, from the first kWh |
| Timing that matters | Little, on monthly or annual netting | Every interval; exports and imports are counted separately |
| Best way to raise savings | System sized to annual use | Use solar on site; store midday surplus |
| Battery case | Mostly backup value | Backup plus bill savings |
Common misconceptions
- Myth Net billing means solar no longer saves money.
- Reality Solar you use in the home still avoids the full retail rate. Only the exported share earns less.
- Myth Net billing and net metering are the same thing.
- Reality Net metering nets kWh. Net billing prices exports and imports separately and settles in dollars.
- Myth A bigger system always saves more.
- Reality Under net billing, extra panels mostly add low-value exports.
- Myth The export rate is fixed for life.
- Reality Many utilities reset it, often each year 1.
Net billing in South Carolina
Several South Carolina utilities outside the investor-owned group use dollar-based crediting. Palmetto Electric pays $0.04662 per kWh for 2026–27, up from $0.04329 in 2025–26 1.
The City of Rock Hill passes exports to the Piedmont Municipal Power Agency at $0.03874 on-peak and $0.02168 off-peak, rates in effect from 1 January 2021 that PMPA calls minimums 3.
Greer CPW credits 6.54¢ on-peak and 4.251¢ off-peak under rate code 750 4. Duke and Dominion customers are on Solar Choice tariffs, which net kWh within time-of-use periods instead. All retrieved 5 October 2026.
Virginia and Georgia
Virginia's Dominion order (Case PUR-2025-00079, final order 30 April 2026) keeps annual kWh netting rather than moving to net billing; only annual net excess is credited at $0.05829 per kWh, for new non-low-income interconnections from about 1 May 2027 7.
In Georgia we have not verified the current solar tariffs of Georgia Power or the EMCs, so check with your utility whether exports are netted or billed separately.
When net billing matters to you, and what to do next
It matters most if you are away during the day, or if your installer proposes a system that makes more than you use. In both cases, a large share of your solar is exported at the lower rate.
Rule of thumb: under net billing, size the system to your daytime use first. Add a battery only if the gap between retail and export rates, times the kWh you would store, beats the battery’s cost over its life.
Next step: get the export rate and its reset date in writing. Then test your numbers in the net billing calculator.
Related guides and tools
Questions about net billing
Is net billing worse than net metering?
For the same system, net billing usually pays less for exports. Savings are lower unless you use more solar on site or add storage. How much lower depends on the gap between your retail and export rates.
A home that uses most of its solar during the day may see only a small difference. A home that exports most of it will see a bigger one.
Does net billing make a battery worth it?
It improves the case, but does not settle it. Each stored kWh avoids a retail-priced import instead of earning the lower export credit.
Round-trip losses take a share of every stored kWh, and the battery has its own cost and lifespan.
Compare the yearly gain with the battery’s cost over its warranty period before you decide.
Is California's NEM 3.0 net billing?
Yes. The CPUC calls it the Net Billing Tariff. It has applied to interconnection applications since 15 April 2023, under Decision D.22-12-056. Exports are credited at a rate meant to reflect their value to the grid, not the retail rate. “NEM 3.0” is the popular name, not the official one.
How do I know if my utility uses net billing?
Read the solar rider or tariff. If exports are credited in dollars per kWh as they happen, and imports are billed in full, it is net billing.
If exports are subtracted from imports in kWh before pricing, it is net metering. Words like “value of renewable generation,” “export credit” or “buyback rate” point to net billing.
What happens to leftover net billing credit?
It depends on the tariff. Many utilities carry leftover dollar credit to the next bill. Palmetto Electric rolls it over month to month while the account stays active. Some utilities pay it out once a year or let it expire. Ask your utility, and look for the rule in the rider’s text.
Do I need a special meter for net billing?
You need a meter that measures power in both directions. The utility usually provides it. Palmetto Electric, for example, provides a standard two-way meter. Extra meters or grid upgrades may have their own rules, so ask your utility what it covers.
Can my export rate change after I sign up?
Often yes. Many utilities reset the export rate on a schedule. Palmetto Electric’s rate moved from $0.04329 per kWh in 2025–26 to $0.04662 in 2026–27. Ask whether your rate is fixed for a term or reset each year, and plan your savings around a range rather than one number.
Should I size my system smaller under net billing?
Often, yes. Under net billing, panels that only add exports earn the lower rate. Sizing to cover your daytime use first gives each panel more value. If you plan an EV or a battery, size for that future use. Ask your installer to show savings for two or three sizes.
Is net billing the same as a buyback program?
They are close cousins. Both pay a set price for exported power. “Buyback” often means the utility buys all or part of your output at a fixed rate, sometimes avoided cost. “Net billing” usually means exports and imports are priced separately on one bill. The rider’s text tells you which applies.
Sources
- Palmetto Electric Cooperative, net billing rider and credit rates, retrieved .
- California Public Utilities Commission, Net Energy Metering and Net Billing (Net Billing Tariff, D.22-12-056), retrieved .
- City of Rock Hill, Tri-Party net billing agreement with PMPA (rev. 17 Sep 2020; read via Internet Archive), retrieved .
- Greer CPW, Residential Renewables rate code 750 (Feb 2026), retrieved .
- 16 U.S.C. §2621(d)(11), PURPA standard for net metering (Cornell LII), retrieved .
- South Carolina Code Title 58 Ch. 40 (Act 62 of 2019, customer-generators), retrieved .
- Virginia SCC, Order on Clarification, Case PUR-2025-00079 (20 May 2026), retrieved .
Expert review
Written by the HyreSolar Research team. Not yet reviewed by an outside expert. We say so rather than imply a review that has not happened; see our editorial policy.
How the numbers were checked: Palmetto Electric’s net billing page and the CPUC’s net metering and net billing page were read on 8 October 2026.
Other South Carolina credit rates are from sc-local/facts.js, each tied to the utility document named. Virginia is the VERIFIED row of the HyreSolar Virginia fact pack. Georgia rates were not verified and are not stated. Held for qualified review before indexing (G-REV).
Suggest a correction. We fix errors and say what changed.