How Net Metering Works

Quick Summary

Net metering lets you earn credits when your solar system produces more electricity than you use. Those credits roll over and offset your future bills. In Massachusetts, the rules are especially favorable: credits don’t expire, they apply to your entire bill (not just supply), and systems are grandfathered under current rules for 25 years.

Why this matters

Solar energy production and home energy use don’t always match up. Your panels generate the most electricity during the day, while you may use more power in the evening. Net metering ensures your extra daytime production isn’t wasted — it’s banked as a credit on your utility bill, so you still save later.

In Massachusetts, these credits are especially valuable, since they reduce all charges on your bill — supply, delivery, and even fixed charges.

What to Know in Massachusetts

• Full retail value for residential solar: Credits are applied at close to retail rate (around 90%).
• No expiration: Credits roll over indefinitely until you use them.
• No minimum bills: Unlike in some states, there are no fixed charges you can’t offset.
• Virtual net metering: Credits can be shared with another account in the same utility zone — helpful if you own multiple properties or want to share credits with friends, relatives, etc.
• Grandfathering protection: Once your system is interconnected, you’re locked into today’s net metering rules for 25 years.

Step-by-Step

1. Panels Produce Power During the Day
   When the sun shines, your panels turn that sunlight into electricity your home can use right away.
2. Your Home Uses Solar Power First
   Your home draws power directly from your solar panels before using grid power.
3. Excess Power Goes to the Grid
   Any extra electricity your panels make is sent through a two-way “net meter” that tracks what you send to the grid.
4. You Earn Credits for Energy Sent Back
   For every kilowatt-hour you export, your utility adds a credit to your account.
5. Use Credits When the Sun Isn’t Shining
   At night, in winter, or during high-use months, those credits offset what you draw from the grid.
6. Credits Roll Over with No Expiration in Massachusetts
   If you build up credits, they carry forward indefinitely — so nothing goes to waste.

Helpful Tips & Watchouts

• Utilities only issue bill credits and will never pay you cash for net metering credits.  Therefore, you should either be able to use the credits yourself of have an electric account you plan to transfer the credits to.  It can be any customer in the same utility. 
• Batteries let you store and use more of your own solar directly, so you have less buying and selling with the utility.
• Policy can change — and while you’ll be grandfathered, acting sooner locks in today’s most favorable rules.

Key Takeaways

• Net metering lets you earn bill credits for extra solar power you send to the grid.
• In Massachusetts, those credits roll over with no expiration and apply to your whole bill — not just supply charges.
• When your panels aren’t producing, those stored credits automatically reduce what you spend.
• Adding a battery storage system allows you to use more of your own energy directly and reduce buying and selling with the grid.
• Some states are moving to “net billing” which is a less favorable system crediting excess at “wholesale electric rates,” but Massachusetts continues to offer “retail net metering credits” making it one of the most favorable states for solar in the country. If you considering solar, you should act now to lock in today’s net metering policy for the next 25 years.