- What credit rate applies to exports? Is it full retail, a lower buyback rate, or time-based?
- How are credits rolled over? Can unused credits carry into future months, or do they expire?
- What happens at year-end? Some utilities reconcile credits annually, while others may pay out remaining balances differently
If you’re shopping for home solar, one of the first things to understand is how your utility handles the electricity your panels send back to the grid.
That policy can have a major impact on how a solar system performs on paper and how it affects your monthly bill in real life.
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The confusing part is that people often use net metering , solar buyback plan , and export credit as if they mean the same thing, but they can work very differently.
This guide explains the basics in plain English so you can read your utility’s policy with more confidence, ask better questions of installers, and avoid being surprised later by bill credits that do not work the way you expected.
What net metering actually means
Net metering is a billing arrangement that lets solar customers receive credit for excess electricity their panels export to the grid. During the day, your panels may produce more power than your home is using.
When that happens, the extra electricity flows to the utility system, and your meter can run backward or otherwise track a credit, depending on how your utility measures it.
At its simplest, net metering helps offset the electricity you draw from the grid at night or on cloudy days.
We go deeper on this in how solar & energy actually works — worth a read before you decide anything.
Instead of buying every kilowatt-hour at retail price and selling excess power back at a different price, the utility applies credits in a way that can reduce what you owe on your bill.
How solar buyback plans differ from net metering
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A solar buyback plan is a broader term. It usually means the utility credits you for exported solar power, but the credit rate may be lower than the retail rate you pay for electricity.
In other words, you may not get one-for-one credit for every unit you send to the grid.
That difference matters because it changes the value of daytime overproduction. With full net metering, exported electricity often offsets later usage at the same general rate.
With a buyback plan, the export credit may be based on a lower avoided-cost rate, a time-of-use rate, or another formula set by the utility.
For homeowners, the practical takeaway is simple: don’t assume all solar credits are equal . Two systems with the same panels can produce very different bill outcomes depending on the utility’s rules.
Sources & further reading
This article is for general information only and is not professional financial, legal, or medical advice.
Tom Bishop — Home & Safety Editor
Tom covers home security, improvement, and energy topics, comparing options on cost, reliability, and real-world performance so homeowners can decide with confidence.
Updated August 2026