What changed
Net metering used to credit excess solar production at the full retail electricity rate. California’s NEM 3.0, Arizona’s export rate, and several Midwest pilots now credit exports at the wholesale ‘avoided cost’ rate, which can be 60–80% lower. That makes solar most valuable when you can use the electricity yourself, the moment it is produced.
What still works in your favor
- The 30% federal Residential Clean Energy Credit is in effect through 2032.
- Hardware costs have continued to fall: the typical residential install is $2.80–$3.50 per watt before incentives.
- Most states still allow some form of net billing, even if not full retail credit.
- Adding a battery dramatically improves payback under the new rules because it lets you self-consume evening loads.
Quick payback estimate
Use our Solar ROI Calculator to plug in your bill, system size, and local electricity rate. As a rule of thumb, a 7 kW system in a sunny climate with a $200/month bill and standard net metering still pays back in 7–10 years and produces 25-year savings of $35,000–$60,000 after the federal credit.
When to skip solar
If your roof needs replacement in under five years, your trees shade more than 30% of the array, or your utility offers wholesale-only export rates without a battery option, wait or invest in efficiency first.
What to ask three installers
- What is your assumed annual production in kWh, and how was it modeled?
- What is the panel and inverter warranty, and who services it locally?
- What is the all-in cost per watt before and after the federal credit?
- What does my export credit look like for the next 10 years under current rules?
Bottom line
Solar still pencils out for most owners with reasonable sun, decent roofs, and stable plans to stay in the home. It just rewards a bit more diligence than it used to.