What your exported power is actually worth in California, how the credit is calculated, and what that means for sizing a system.
Under the old net metering, a kilowatt-hour you exported earned close to the retail rate you paid. Under NEM 3.0 exports are credited at avoided cost — what the utility would otherwise pay to source that power — calculated by the CPUC Avoided Cost Calculator.
That is roughly 5 to 8¢ against a retail rate of 30 to 55¢ at peak. Exporting midday production is now a poor trade.
The value has moved to using your own production during the 4pm–9pm peak, which for most homes means a battery. A well-designed solar-plus-storage system captures a much larger share of production at full retail value.
NEM 3.0 applies to PG&E, SCE and SDG&E. Municipal utilities including LADWP, SMUD and Silicon Valley Power are not bound by it and generally offer more favourable terms — check which serves your address, because it changes the entire calculation.
Sources: CPUC Net Billing Tariff decision; CPUC Avoided Cost Calculator.
Net metering is a billing arrangement, not a rebate. Nobody sends you a cheque. Your meter runs backward and your bill goes down.
It also does not eliminate your bill entirely. Fixed customer charges continue regardless of usage, and most utilities true up on an annual cycle rather than paying cash for a surplus.
Which is why system sizing matters: a system built well beyond your annual usage produces credits worth far less than the ones that offset what you actually consume.
The 30% federal Residential Clean Energy Credit under Section 25D ended for systems purchased after December 31, 2025. If you buy with cash or a loan in 2026, you cannot claim it. Any site still advertising a 30% federal credit for a homeowner purchase is running outdated information.
What remains is Section 48E, the commercial investment credit. It applies to third-party-owned systems — leases and power purchase agreements — where the system owner claims it rather than the homeowner. That is precisely what makes $0-down possible.
EnergyPros does not provide tax advice — confirm your situation with a tax professional.
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Not usually. Fixed customer charges continue regardless of how much power you generate, and most utilities settle any annual surplus at a rate well below retail. A well-sized system substantially reduces the bill; it rarely eliminates it.
In most cases, one sized to your actual annual usage. Building well beyond that produces credits that are worth far less than the ones offsetting what you consume, because surplus is typically trued up at avoided cost rather than retail.
Net metering credits generally stay with the meter rather than the person. If you sell, the arrangement transfers with the property. If you are on a lease or PPA, that agreement transfers to the buyer — your installer handles the paperwork.
It can, considerably — especially where exports are credited below retail. A battery lets you use your own production during expensive hours instead of exporting it cheaply. In states with 1:1 retail credit the case is weaker; in net billing states it is usually decisive.
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