Net Metering in 2026: State-by-State Guide
Table of Contents
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Net metering credits the solar power you send to the grid at the same retail rate you pay for grid power, and in 2026 it is still the rule in states such as New Jersey, Massachusetts, Maine, Maryland and New York. Several large solar states have moved to "net billing," which credits exports at a lower rate: California (NEM 3.0, since April 2023), Hawaii (since 2015) and Arizona (since 2017). Connecticut replaced net metering in 2022 with a tariff program whose netting option still credits monthly excess at the retail rate, minus a per-kWh charge on solar output. Where exports earn less, the best strategy is to use more of your solar power yourself, often with a battery.
Net metering rules change often and differ by utility, not just by state. Confirm the current tariff with your utility or on DSIRE before you size a system.
What is net metering?
Net metering is a billing arrangement in which each kilowatt-hour your panels export earns a credit equal to what you pay to buy a kilowatt-hour back. If your rate is $0.20/kWh, exporting 1kWh earns $0.20. The grid works like a free battery: you bank daytime surplus and draw it back at night.
Net metering vs net billing vs avoided cost
- Net metering (1:1 retail credit): exports are worth the full retail rate. The most homeowner-friendly arrangement.
- Net billing: exports earn a lower, separately set rate. California's NEM 3.0 bases export credits on the state's Avoided Cost Calculator, which is on average far below retail rates, so each self-consumed kilowatt-hour is worth much more than an exported one.
- Avoided cost or wholesale: exports earn roughly what the utility would pay for power on the wholesale market, the least favorable arrangement for solar owners.
Why it matters: annual bill savings = (self-consumed kWh x retail rate) + (exported kWh x export rate). With 1:1 net metering both terms use the retail rate; under net billing the export term shrinks, which stretches payback. See our solar cost and payback guide for a worked example.
Which states have the best net metering in 2026?
New Jersey
New Jersey offers retail-rate net metering, and its Successor Solar Incentive (SuSI) program pays additional certificate income for each megawatt-hour a qualifying system generates, at values set by the state Board of Public Utilities; for net-metered homes that apply on or after July 27, 2026 the value is $77 per certificate (one per megawatt-hour), down from $85, according to the program administrator. Combined with electricity rates above the national average, that makes New Jersey one of the stronger solar markets.
Massachusetts
Massachusetts uses retail net metering, and its SMART (Solar Massachusetts Renewable Target) 3.0 program pays an incentive on top of net metering credits: $0.03 per kWh in 2026 for most home systems of 25kW or less ($0.06 for low-income customers), locked in for 20 years (MassCEC). High electricity rates make each self-consumed kilowatt-hour especially valuable.
Maine
Maine's net energy billing credits residential exports at the retail rate as kilowatt-hour credits, which expire after 12 months. A 2025 law, LD 1777, closed net energy billing to new front-of-the-meter projects (solar farms without an interconnection agreement by December 31, 2025), but rooftop systems still earn kWh credits (Maine PUC). High rates for the region make solar competitive despite the northern latitude.
Maryland
Maryland still credits exports at the retail rate, but not for new customers much longer. The Utility RELIEF Act of 2026 (HB 1532, signed May 12, 2026) closes retail-rate net metering to new enrollees on July 1, 2027, or earlier if net-metered capacity statewide reaches 3,000MW. By February 1, 2027 the Public Service Commission must approve a successor program to start July 1, 2027, and the law requires its incentives to be smaller than today's. The PSC will also set, by regulation, how long existing customers keep retail-rate credits. Rates are closer to the national average than in New England, so payback is longer; check the Maryland Energy Administration for current state grant programs.
New York
New York offers net metering for residential systems (newer systems also pay a small monthly customer benefit contribution charge) and offers a 25% state income tax credit for residential solar, capped at $5,000. Customers in the New York City area pay some of the highest electricity rates in the country, which increases savings.
For the federal side, note that the 30% federal tax credit that many older guides add on top of these state programs ended for homeowner-owned systems installed after December 31, 2025. See our 2026 tax credit explainer.
Which states have rolled back net metering?
California: NEM 3.0
For new customers since April 2023, California's net billing tariff (NEM 3.0) credits exports at Avoided Cost Calculator values that are much lower on average than the retail rates customers pay, while customers who connected under the earlier NEM 1.0 and 2.0 rules keep them for 20 years from interconnection. The result: new California systems are usually designed around a home battery that stores midday solar for evening use instead of exporting it. Solar with storage can still pay off in California; solar without storage is much weaker than it was before 2023.
Hawaii
Hawaii closed traditional net metering to new customers in 2015. Its successor programs credit exports below retail rates or limit exports, which is why most new Hawaii systems include batteries. New Hawaiian Electric rooftop customers now choose Smart Renewable Energy Export, which credits exports by time of day (on Oahu, 13.5 cents per kWh from 9 a.m. to 5 p.m. and 32.9 cents from 5 to 9 p.m. for 2024-2026, per Hawaiian Electric), or a non-export option. Hawaii shows that even very high electricity prices and abundant sun do not guarantee strong solar economics when exports are undervalued.
Arizona
Arizona moved from retail net metering to net billing in 2017. Exports earn a rate below retail (the Resource Comparison Proxy), and new customers lock their export rate for 10 years (APS tariff). Systems are now sized to maximize self-consumption rather than export.
Connecticut
Connecticut ended traditional net metering for new residential customers at the end of 2021. Its Residential Renewable Energy Solutions (RRES) program replaced it in January 2022 and runs through 2027 (PURA). It offers two options. Under "netting," excess generation at the end of each month is credited at the full retail rate, but netting projects that apply in 2026 pay a $0.0402/kWh "solar energy adjustment" on total solar production. Under "buy-all," the utility buys all of the system's output at a fixed rate locked for 20 years: $0.3289/kWh for 2026 applications at Eversource (Eversource). That makes Connecticut a partial rollback rather than California-style net billing.
Are existing solar customers protected when rules change?
Usually, for a set period. California lets customers who connected under NEM 1.0 or 2.0 keep that tariff for 20 years from interconnection, and Arizona locks each new customer's export rate for 10 years. Protection periods and what they cover differ by state and utility, so ask your installer for the tariff and term in writing before you sign.
What should I do if my state has weak net metering?
- Size for self-consumption: design for roughly 70% to 90% of annual use rather than 100% or more, so fewer kilowatt-hours are exported at low rates.
- Add storage: a home battery shifts midday solar to the evening. A portable power station can do the same on a small scale for specific loads; see our home backup rankings.
- Move loads to midday: run the dishwasher, laundry and EV charging while the panels are producing.
- Use time-of-use rates to your advantage: if evening peak prices are high, stored solar used at peak saves more than it would earn exported. See time-of-use electricity rates.
For how net metering feeds into overall returns, see Does Rooftop Solar Actually Pay Off? If rooftop solar does not work for your home, community solar may be an option.
Several states now allow small plug-in kits with no utility approval; see our guide to plug-in balcony solar in the US for the state laws.
Frequently Asked Questions
What is net metering for solar panels?
A billing arrangement in which each kilowatt-hour your panels export earns a credit equal to the retail rate you pay for grid power. At $0.20/kWh, exporting 1kWh earns $0.20. Rules vary by state and utility.
Which states have the best net metering for solar?
States that still credit exports at retail rates include New Jersey, Massachusetts, Maine, Maryland and New York, though Maryland's program closes to new customers on July 1, 2027. New Jersey and Massachusetts add per-kWh incentive programs (SuSI and SMART 3.0, which pays $0.03 per kWh in 2026 for 20 years), and New York offers a 25% state tax credit capped at $5,000.
What happened to California's net metering?
Since April 2023, new California customers are on NEM 3.0 net billing, which credits exports at Avoided Cost Calculator values far below retail on average. Customers who connected under NEM 1.0 or 2.0 keep those rules for 20 years from interconnection.
What is net billing vs net metering?
Net metering credits exports at the retail rate. Net billing credits exports at a lower, separately set rate, so solar power you use yourself is worth more than power you export.
Does net metering affect solar payback?
Yes, often more than any other factor. Savings = self-consumed kWh x retail rate + exported kWh x export rate. Lower export rates shrink the second term and lengthen payback unless you add storage or shift loads.
If net metering changes, are existing customers protected?
Usually for a set period. California lets NEM 1.0 and 2.0 customers keep their tariff for 20 years, and Arizona locks each customer's export rate for 10 years. Get the tariff and term in writing from your utility or installer.
Is solar worth it in states with poor net metering?
It can be, with a different design: size the system to about 70% to 90% of your use, add a battery to shift midday power to the evening, and run big loads while the sun is up. Where electricity is cheap and exports earn little, returns are weak.
