By Claire WhitakerUpdated November 2026
Net energy metering PG&E customers rely on is the program that decides how your rooftop solar exports are credited on your bill. For most California homeowners who already have a system, the choice in front of you is between staying on the older net energy metering (NEM) tariff and moving to the newer net billing structure that PG&E now applies to most new interconnections. Net metering tends to win for homes with older systems or those that export heavily during the day, while net billing rewards households that can shift their electricity use toward midday and pair their panels with storage. Read on to see how the two compare across the criteria that actually move your bill.
| Criterion | Net Energy Metering (NEM 2.0 / legacy) | Net Billing (NEM 3.0) |
|---|---|---|
| Who it applies to | Systems interconnected under the older tariff, plus some grandfathered customers | Most new PG&E rooftop systems interconnected after the transition date |
| How exports are valued | Exported kWh are credited at close to the retail rate on a one-for-one basis | Exports are valued at avoided-cost-based export rates that change by time of day |
| Value of midday exports | Full retail-level credit for every kWh sent to the grid | Substantially lower credit, especially during the afternoon solar peak |
| Role of batteries | Helpful but not required to get good value from exports | Strongly favored, since storing midday energy for evening use keeps more value |
| Bill predictability | Generally easier to forecast because credits track retail rates | More variable, depends on hourly export and import patterns |
| Customer action needed | Usually none beyond routine monitoring | Often benefits from load shifting, time-of-use planning, or storage |
| Best fit | Homes with existing NEM contracts or large daytime exports they can’t store | New systems in homes that can run appliances midday and add a battery |
Credit Value for Exported Energy
The single biggest difference between these two options is how much each kilowatt-hour you send to the grid is worth. Under the legacy net energy metering arrangement, exports are credited at a rate close to your retail energy rate, and those credits roll forward against the power you import later. In practical terms, a kilowatt-hour you export at noon can offset a kilowatt-hour you draw at 8 p.m. at close to full value.
Under net billing, the export credit is set at a much lower rate that reflects what the utility would otherwise pay for power at that moment. Because solar output peaks in the middle of the day, when wholesale prices are often lowest, the credit for midday exports is at its smallest. Evening imports are still billed at retail-based rates, so the gap between what you earn for exporting and what you pay for importing widens.
Winner for credit value: Net energy metering. If your main goal is to maximize the dollar value of every kilowatt-hour your panels produce and export, the legacy structure is more generous.
Battery Storage and Self-Consumption
Under net billing, the most effective way to get value from your system is to use the power yourself rather than send it to the grid. That means running dishwashers, laundry, and pool pumps during the afternoon, and, for many homes, adding a battery that captures midday output for the evening peak. A battery lets you store energy that would otherwise be exported at a low rate and use it when imports are expensive.
Batteries are not mandatory under net metering. A household on the legacy tariff can export freely and draw from the grid at night without storage, because the credit system does the balancing. Storage still has value for backup power or for reducing reliance on the grid, but it is a separate decision rather than a requirement for good economics.
Winner for storage flexibility: Net billing. The structure rewards households willing to manage their load and add a battery. Homes that want a simpler setup without battery hardware will do better staying on net energy metering.
Bill Predictability and Monitoring
Net energy metering is easier to forecast. Because credits track retail rates closely, a homeowner can estimate annual savings from system size, roof orientation, and historical usage with reasonable confidence. Your monthly bill often shows a credit balance that rolls over, which makes it simple to see how production and consumption are offsetting each other.
Net billing introduces more variation. Your bill depends on the timing of exports and imports, so two households with identical systems can see different results if one runs appliances at midday and the other does not. Owners who check their bills monthly and review hourly production data through their inverter app generally understand their results faster.
Winner for predictability: Net energy metering. If you prefer a stable, easy-to-read bill and do not want to monitor usage patterns closely, the legacy tariff is the more straightforward choice.
Eligibility and Enrollment Timing
Eligibility is often the deciding factor, and it is not always up to you. PG&E generally places new rooftop interconnections under net billing, so if you are installing a system now, you will most likely be on that structure. Homes that already have an interconnection agreement under the older program typically keep those terms for the life of the agreement, though changes to the system, such as adding significant new capacity, can trigger a review.
Before you commit to a system size or a battery purchase, confirm which tariff your application will fall under. The enrollment rules and the interconnection timeline can shift, so check your PG&E interconnection paperwork and ask the installer to show you the tariff in writing. Consult a licensed electrician or your installer for technical questions about interconnection, and a tax or energy advisor for questions about incentives.
Winner for existing customers: Net energy metering. If your system is already interconnected under the legacy program, staying put is usually the better move. For new systems, net billing is the default, so plan around it.
Installation and Equipment Considerations
Your array’s orientation, tilt, and shading matter under both structures, but they matter more under net billing. A south- or west-facing array with a low-shade roof produces the afternoon output that helps you reach the evening battery window, while a poorly oriented system may generate less at the times when credits are most valuable. Get a production estimate from your installer that breaks output down by hour, not just by month.
Equipment choice follows from the tariff. If you expect to use net billing, look at inverters with reliable monitoring apps and at batteries that integrate cleanly with your system. Products commonly paired with rooftop systems include the Tesla Powerwall 3 and the Enphase IQ Battery 5P, both widely installed in residential projects. For monitoring, many homeowners use the Emporia Vue energy monitor to track circuit-level usage, which helps with load shifting decisions.
For background on how net metering credits are calculated over a billing cycle, see Net Energy Metering True-up: How It Works and What Homeowners Should Check, and for the application steps, see Net Energy Metering Application: A Step-by-Step Guide for Homeowners.
Which Should You Choose?
The right answer depends less on preference than on your system’s status and your household’s habits. Use these guidelines to narrow it down:
- Choose net energy metering if your system is already interconnected under the legacy tariff and you have no plans to expand it.
- Choose net energy metering if you want a predictable bill and prefer not to manage appliance timing or storage.
- Choose net billing if you are installing a new system, which PG&E generally places on this structure.
- Choose net billing if you can run major appliances during the day and are open to adding a battery.
- Choose net billing if you want backup power during outages and plan to size storage to your evening load.
- Revisit your decision if your household is mostly away during the day, since that changes how much you can self-consume.
For context on how other utilities handle the same tradeoff, you may find Net Energy Metering in California vs Net Billing: Which Should You Choose? and Net Energy Metering Program vs Net Billing: Which Should You Choose? useful, and Net Energy Metering Hawaii vs Net Billing: Which Is Better for Homeowners? shows how a different state approached the same question.
FAQ
Is net energy metering PG&E still available for new systems?
For most new rooftop interconnections, PG&E applies net billing instead of the legacy net energy metering tariff. Customers who already have an interconnection agreement under the older program generally keep those terms. Confirm your status with PG&E and your installer before you finalize a contract.
Does net billing mean I should always buy a battery?
Not always. A battery adds the most value when you can store midday production and use it during the evening peak. If your household is home during the day and uses a lot of power then, a battery may be less important. Model your usage before you buy.
How do export credits show up on my bill?
Under net energy metering, credits typically appear as a balance that offsets future imports, often rolling forward month to month. Under net billing, exports are valued at time-based rates, so the credit depends on when you send power to the grid. Your monthly statement shows the breakdown.
Can I switch from net billing back to net energy metering?
Switching is generally not something a customer can choose freely. The tariff is tied to the interconnection agreement and the date the system was approved. Ask PG&E directly whether any options exist for your specific account, since rules can change.
Who should I contact with questions about my interconnection?
Start with PG&E’s customer service for billing and tariff questions, and with your installer for system design and interconnection paperwork. For electrical work, use a licensed electrician. For financial decisions tied to incentives or taxes, consult a qualified tax or energy advisor.
Conclusion
Net energy metering PG&E customers on the legacy tariff enjoy generous export credits and a predictable bill, which makes the older structure the stronger choice for existing systems and for homeowners who want minimal management. Net billing, which now covers most new installations, rewards households that can shift their usage toward midday and consider a battery. Check your interconnection status first, then match the structure to how your home actually uses electricity. Your installer and PG&E can confirm the details for your address.
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About Claire Whitaker
Claire Whitaker is part of our editorial team and reviews and edits our home solar guides, checking product details against manufacturer specifications and owner feedback.
