Net Billing
An export compensation mechanism where excess solar electricity sent to the grid is credited at a rate lower than the retail rate — typically wholesale, avoided cost, or a set export rate.
Why It Matters
Net billing is replacing net metering in many states (California NEM 3.0 is a form of net billing). It reduces the value of exports, making batteries and self-consumption more important.
Related Topics
Related Terms
Net Metering
A billing mechanism that credits solar energy system owners for the electricity they add to the grid. The excess power generated during the day offsets power consumed at night.
NEM 3.0 (Net Billing)
California's successor to traditional net metering, which compensates solar exports at a lower "avoided cost" rate rather than the full retail rate. Took effect April 2023.
Avoided Cost
The cost a utility would have incurred to generate or purchase electricity that was instead provided by a distributed resource like rooftop solar.