Net metering, feed-in tariffs, and export tariffs all assign value to electricity sent from a solar system to the grid, but they use different accounting rules. Net metering generally offsets imports and exports within a billing framework. A feed-in or export tariff pays a specified rate for eligible exported or generated electricity. Net billing values imports and exports separately.
The label alone is not enough. Eligibility, measurement, credit rate, settlement period, expiry, and fixed charges determine the real value to a household.
The main models at a glance
| Model | How electricity is treated | Typical value mechanism |
|---|---|---|
| Net metering | Imports and exports are offset within a defined period | Exported units reduce billed net consumption, sometimes near retail value |
| Net billing | Imports and exports are measured separately | Imports charged at retail rate; exports credited at another rate |
| Feed-in tariff | Eligible generation or exports receive a defined payment | Fixed or formula-based rate, often under program terms |
| Export tariff | Electricity sent to the grid receives a stated rate | Supplier, utility, or market-linked export payment |
| Gross metering | All solar generation is measured separately from home use | Generation paid under one rate; household consumption billed normally |
| Buy-all, sell-all | All output is sold and all household use is purchased | Separate purchase and sale transactions |
Programs often blend these ideas. Read the tariff rules rather than assuming a familiar name works the same way in another market.
Self-consumption comes before export
In many behind-the-meter systems, solar electricity serves household loads first. Only the surplus reaches the grid.
If the home is using 2 kW while the array produces 3 kW, about 2 kW can be consumed on site and 1 kW exported, before considering system losses and other controls. Electricity used directly can avoid a retail purchase. Exported electricity receives the applicable program value.
This distinction matters when the retail price is higher than the export rate. Shifting suitable loads into solar hours can then be more valuable than exporting the same energy.
How net metering works
Net metering is a billing arrangement that accounts for electricity supplied by the grid and electricity delivered back by an eligible customer-generator.
Traditional descriptions often say the meter runs backward. Modern programs can be more complex. A digital meter may record imports and exports separately while the bill applies netting rules across an hour, day, month, or longer period.
Important details include:
- Which customers and system sizes qualify
- The period over which imports and exports are netted
- The value assigned to credits
- Treatment of unused credits
- Fixed, minimum, demand, or grid charges
- Expiry or annual reset rules
- Ownership of environmental attributes
- Changes for new versus existing customers
Full retail net metering can value an exported kWh similarly to an imported kWh within the allowed framework. Other programs apply avoided-cost, wholesale, or reduced rates and may be described as net billing instead.
How net billing differs
Under net billing, imports and exports are valued separately. The household pays the retail tariff for electricity drawn from the grid and receives a distinct export credit for electricity sent out.
The export rate may be fixed, time-varying, wholesale-linked, or based on an estimate of grid value. Credits can appear on the bill without directly cancelling units one for one.
Net billing increases the importance of self-consumption when the export rate is lower than the import rate. Batteries and load shifting may gain financial value, though their costs still need separate analysis.
How feed-in tariffs work
A feed-in tariff is a policy or contract that pays eligible generators a defined rate for renewable electricity. Programs can apply to all generation or only exports.
Historically, some feed-in tariffs used long contracts and premium rates to encourage deployment. Modern arrangements may use lower rates, auctions, market links, capacity limits, or periodic revisions.
Check:
- Whether payment covers gross generation or exports only
- Contract length and start date
- Fixed, indexed, stepped, or variable rate
- Technology and system-size eligibility
- Installation and metering standards
- Application deadlines and program caps
- Transfer rules when a property is sold
A generous historical tariff may be closed to new systems while remaining valid for enrolled customers.
Export tariff is a broader term
An export tariff generally means a rate paid for electricity exported to the grid. It may be offered by a utility, energy supplier, retailer, aggregator, or government-backed program.
The rate can be flat or change by time. Some programs require a compatible smart meter, approved equipment, a specific supplier relationship, or proof that the installation meets technical standards.
An advertised peak export rate may apply only during limited hours. Compare the likely weighted average across the system's actual export profile.
Gross metering changes the household flow
Gross metering measures and compensates all solar generation separately. Household loads continue to buy electricity under the normal retail tariff.
This structure can make on-site consumption irrelevant to the generation payment, depending on the rules. It may require separate meters or wiring arrangements.
Do not assume that adding a battery or shifting loads will create the same savings under gross metering as it would under self-consumption and net billing.
Why the settlement period matters
Netting over an hour is different from netting over a month or year. A longer period can allow daytime exports to offset nighttime or seasonal imports more broadly.
Credit expiry also matters. A household that accumulates surplus credits during sunny months may lose value if they reset before high-demand months. Cash payout, rollover, and carry-forward rules can produce different outcomes even at the same nominal rate.
Fixed charges can remain
Export credits may reduce the variable energy portion of a bill without removing connection, service, minimum, tax, or demand charges.
A bill forecast should show each charge separately. Claims that solar will eliminate the bill often ignore costs that do not change with net consumption.
Export limits and curtailment
Networks may limit the amount a system can export because of local grid capacity, voltage, congestion, or program rules. Limits can be fixed or dynamic.
A system may be allowed to generate more than it exports if the home consumes or stores the difference. Control equipment can curtail production when the export ceiling is reached.
Export limits affect system sizing, battery value, and payback. They should appear in the proposal and production model.
Questions to ask about any solar export program
- Is compensation based on gross generation, exports, or net consumption?
- What meter records each flow?
- What rate applies, and can it change?
- Does the rate vary by time or supplier?
- Over what period are credits settled?
- Do unused credits expire, roll over, or pay out?
- Which fixed and minimum charges remain?
- Are there system-size or export limits?
- Which equipment, installer, or certification rules apply?
- What happens if the property changes owner or energy supplier?
Use current documents from the responsible regulator, utility, network, or supplier. Installer summaries can help, but the governing tariff controls the result.
How these models change a solar decision
High export value can support a larger array and reduce the financial case for storage. Low export value can favor self-consumption, load shifting, or a carefully sized battery. Export constraints can make additional capacity less useful unless the household can consume or store more generation.
These effects are market-specific. The global principle is to separate solar energy into self-consumed and exported portions, then value each under the actual rules.
Read the rules behind the label
The practical difference between net metering and a feed-in tariff lies in measurement, rate design, and settlement. Program names are shorthand, and the same term can cover different structures.
Before estimating savings, identify what is measured, when credits are calculated, what each exported kWh is worth, and which charges remain. Then carry those values into the solar payback calculation. Country and utility pages should provide current rules; this framework explains how to interpret them.
Continue through the Solar Incentives hub for related grid and policy guidance.
Sources
- U.S. Energy Information Administration: Renewable Energy Incentives
- U.S. Energy Information Administration: Feed-In Tariffs
- U.S. Energy Information Administration: Net Metering Glossary
- U.S. Department of Energy: Homeowner's Guide to Solar
- IEA PVPS: Methodology for Analysis of PV Self-Consumption Policies