NEM 3.0 State-by-State Net Metering Guide — What You'll Actually Earn Per State
Last updated: 2026-06-15
How Net Metering Actually Works
When your solar panels produce more electricity than your home needs at that moment, the surplus flows to the grid. Net metering determines what you get back for it.
Full retail net metering gives you a credit equal to the full retail rate you'd pay to buy that electricity. If your utility charges $0.15/kWh, you receive $0.15/kWh in credit.
Avoided cost / wholesale pricing pays you only what it costs the utility to generate or purchase that power on the open market — typically $0.03–$0.08/kWh. This is dramatically lower than retail.
Value-of-solar (VOS) or "value stack" programs attempt to price exported energy based on its actual grid value — time of day, location, grid stress. Results vary widely; some are better than retail, many are worse.
The gap between retail and avoided cost can be $0.10–$0.25/kWh. On 2,400 kWh exported per year, that's $240–$600 annually. Over a 25-year panel life, that's $6,000–$15,000 in difference — easily swamping the cost difference between competing solar bids.
The 10-State Comparison
For each state, we calculate:
- Annual export credit (2,400 kWh × export rate)
- Total annual solar value (self-consumed kWh savings + export credit)
- Estimated simple payback on a net-cost system of ~$15,500 (after 30% federal ITC on a $22,000 system)
1. California — NEM 3.0: The Cautionary Tale
Export rate: ~$0.03–$0.08/kWh (varies by time-of-day; avg. ~$0.05/kWh)
Retail rate: ~$0.32/kWh
Annual export credit: ~$120
Total annual solar value: ~$2,784 (self-consumption) + $120 = ~$2,904
Estimated payback: ~5.3 years
California's NEM 3.0, implemented April 2023, slashed export rates by roughly 75% compared to NEM 2.0. The CPUC's rationale was reducing the "cost shift" to non-solar customers. The effect on new solar buyers was immediate and severe.
The silver lining: California also approved a "bring a battery" incentive structure. Pairing storage with solar (typically 10–13.5 kWh of capacity) shifts your export to evening peak hours when avoided cost rates are higher. With a battery, effective export earnings can rise to ~$0.15–$0.24/kWh during peak demand windows.
Bottom line: In California, a battery is no longer optional — it's the economic foundation of a solar investment. Self-consumption is king.
2. Texas — No Statewide Rule, Wildly Variable Results
Export rate: $0.02–$0.10/kWh depending on utility
Retail rate: ~$0.14/kWh (varies; ERCOT market is volatile)
Annual export credit: $48–$240
Total annual solar value: ~$1,296 (self-consumption) + $48–$240 = ~$1,344–$1,536
Estimated payback: ~10–11.5 years
Texas has no statewide net metering mandate. Major IOUs are not required to offer it. Results depend entirely on who your utility is:
- Austin Energy: Offers buyback at ~$0.097/kWh for residential solar — one of the better deals in the state.
- CPS Energy (San Antonio): Offers net metering up to 20 kW at retail rate for systems interconnected before its 2023 rate restructure; newer customers receive lower compensation.
- Oncor / AEP territory: Retail providers set their own buyback rates; many offer $0.02–$0.05/kWh or flat monthly credits.
Texas solar economics run on self-consumption and backup power value (blackout risk), not export credits. The grid instability after Winter Storm Uri created genuine demand for battery backup that pure financial ROI doesn't capture.
3. Florida — Retail Rate Today, Watch the Legislature
Export rate: ~$0.13/kWh (retail net metering)
Retail rate: ~$0.13/kWh
Annual export credit: ~$312
Total annual solar value: ~$1,248 (self-consumption) + $312 = ~$1,560
Estimated payback: ~9.9 years
Florida still offers full retail net metering, but that status has been actively contested. HB 741 (2023) was signed into law, beginning a phase-down of retail net metering compensation over several years, with the trajectory leading toward avoided-cost rates by the late 2020s.
Customers who interconnect before policy changes take effect may be grandfathered under current rates for 10–20 years, depending on how the law is implemented. If you're considering solar in Florida, timing your interconnection matters.
4. North Carolina — Full Retail, Duke Energy's Footprint
Export rate: ~$0.13/kWh (retail)
Retail rate: ~$0.13/kWh
Annual export credit: ~$312
Total annual solar value: ~$1,248 + $312 = ~$1,560
Estimated payback: ~9.9 years
North Carolina mandates retail net metering through its REPS (Renewable Energy Portfolio Standard) framework. Duke Energy Progress and Duke Energy Carolinas both offer 1:1 net metering credits.
The state's solar-friendly environment (consistent sun, utility-scale solar investments) makes it a reliable market. Watch for Duke Energy rate case proceedings — the utility has sought modifications to net metering compensation in regulatory filings, and the outcome of pending cases could shift the calculus.
5. Arizona — Avoided Cost, Two Very Different Utilities
Export rate: ~$0.076/kWh (APS avoided cost) / varies at TEP
Retail rate: ~$0.13/kWh
Annual export credit: ~$182
Total annual solar value: ~$1,248 + $182 = ~$1,430
Estimated payback: ~10.8 years
Arizona is a split market. APS (Arizona Public Service) moved to avoided cost export rates after a 2017 ACC ruling, paying roughly $0.076/kWh for exports — well below retail. Tucson Electric Power (TEP) has offered slightly more favorable terms in some rate structures.
Arizona's sun resource is extraordinary (among the highest solar irradiance in the country), which partially compensates for the weaker export economics. An 8 kW system in Phoenix may produce 10,500–11,200 kWh/year, not 9,600 — shifting the math meaningfully toward self-consumption value.
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One Rule That Holds in Every State
Net metering policy changes. The federal 30% Investment Tax Credit does not. Whatever happens to export rates over the next decade, the ITC locks in immediate value at installation. Don't let uncertainty about future policy be a reason to delay — but do let it inform how you size and design your system today.
Get the Numbers for Your Home
Every home has a different load profile, roof orientation, and shade situation. A state's average export rate matters — but your specific utility, rate tariff, and system size matter more.
Want a personalized breakdown for your home? Drop your zip code and average monthly electric bill below and we'll send you a state-specific payback analysis with current utility rates.
Rates, incentive programs, and utility policies change frequently. Verify current terms directly with your utility or state energy office before making purchasing decisions. This article is for educational purposes and does not constitute financial advice.