Claire WhitakerBy Claire Whitaker

Updated November 2026

Feed-in tariff vs net metering is one of the first comparisons homeowners face when planning a solar system, because both decide how your utility pays you for the electricity your panels send back to the grid. Net metering usually suits homeowners who want to offset their own consumption one-for-one with their panels and keep the paperwork simple. A feed-in tariff tends to suit owners who produce far more than they use and want a fixed, predictable rate for every kilowatt-hour they export, even though it is less common for individual homes in the United States.

Before comparing them criterion by criterion, it helps to know that these terms are used loosely. In the US, “net metering” is the dominant policy, and most state programs credit your account at or near the retail rate. A “feed-in tariff” is a set rate, often guaranteed for a long contract term, paid for all output rather than only the surplus. For a broader overview, see Feed in Tariff and Net Metering: How Home Solar Export Credits Work.

Feed-in Tariff vs Net Metering at a Glance

Criterion Net Metering Feed-in Tariff
How exports are credited Excess power offsets your future consumption, often at the retail rate Every kilowatt-hour you export is paid at a set rate
Rate stability Tied to your utility’s retail rate, which can change Fixed for the contract term, which is often long
Best for Homes that use most of what they produce, or export in some months and draw in others Systems that send most output to the grid
Metering needs Usually a bidirectional meter Often separate export metering to track all output
Availability for homeowners Widely available across US states Limited, often tied to specific programs or utilities
Administrative complexity Generally low once interconnected Can be higher, with separate contracts and metering
Winner for most US homeowners Net metering Feed-in tariff, where offered and the rate is strong

Compensation Structure: Which Pays You More Per kWh?

The biggest difference is what each option pays for. Under net metering, your exports first reduce the kilowatt-hours you buy from the utility. A kilowatt-hour you export at noon may cancel one you would otherwise buy at 7 p.m., so the credit is worth whatever your retail rate is at that time. In many states that is close to the full retail price, which is why net metering has been so attractive.

A feed-in tariff pays a defined rate per kilowatt-hour exported, whether or not you use that power. The rate is set in advance, usually for a long contract, so you know exactly what each unit earns. The rate may be higher or lower than your retail rate, and it does not follow retail price changes during the contract period.

Winner: Net metering in most US cases, because retail-rate credits are usually generous and widely available. A feed-in tariff wins only when its fixed rate is clearly above your retail price for the whole contract term.

Rate Stability and Long-Term Predictability

Predictability matters when you are planning payback. With a feed-in tariff, the number on your contract is the number you receive, which makes financial modeling straightforward. Owners who want certainty often value this more than maximum possible return.

Net metering tracks your utility’s rate structure. If your utility moves to time-of-use pricing, lowers its export credit, or introduces fixed charges, your effective credit changes. Some owners report that their credits shrank after a rate case, even though their panels produced the same amount. Reading your utility’s tariff sheet and checking for pending proceedings helps set realistic expectations. For example, Dominion Net Metering Proposal vs Current Net Metering: Which Should You Choose? shows how a single utility’s proposed changes can shift the math.

Winner: Feed-in tariff, for predictability, as long as the contract terms are clear and the counterparty is reliable.

Self-Consumption and How Much of Your Power You Use

This criterion depends on your household. If you run the dishwasher, washer, heat pump and an EV charger mostly during daylight, you consume most of your solar output on site. Under net metering, that self-consumption is worth the full retail rate, because you avoid buying power at that price. Under a feed-in tariff, self-consumed power earns nothing from the tariff, since only exports are paid.

If your household uses little power during the day, most of your output will be exported. In that case a feed-in tariff can work well, because every exported unit is paid. Compare your expected daytime use against your system size before deciding. Net metering rules that define self-consumption are explained in Net Metering Solar Program vs Self-Consumption: Which Is Better for Homeowners?

Winner: Depends on usage. Net metering favors homes that use most of their solar on site. A feed-in tariff favors homes that export most of what they generate.

Eligibility, Availability and Program Rules

Net metering is available in a large number of states, though program size, system size limits and eligibility differ. Many programs cap total enrolled capacity, and some have shifted to net billing with lower export credits. Check whether your state still offers full net metering or a successor structure. For state-specific examples, see New York Net Metering vs Grid-Tied Solar Without It: Which Should You Choose? and Washington State Net Metering (2026): Which Is Better for Homeowners?

Feed-in tariffs are far less common for individual US homes. When they exist, they are often tied to specific utility programs, community projects, or legacy incentive schemes that may be closed to new applicants. Before planning around one, confirm that enrollment is still open and that the contract term matches your timeline.

Winner: Net metering, because it is easier to access in most places.

Metering, Interconnection and Paperwork

Net metering generally requires a bidirectional meter that records power flowing in both directions, plus an interconnection agreement with your utility. Once approved, billing usually happens automatically through your normal statement. The workload is mostly upfront.

Feed-in tariffs can require more metering. Some programs ask for a separate production meter, or a meter that records total output in addition to net consumption. You may also sign a longer contract with reporting obligations. Expect more back-and-forth with the utility and more attention to your monthly statements.

Whatever you choose, keep copies of your interconnection approval and meter readings. For the process of applying, see Sdg&e Net Metering Application: Step-by-Step Guide for Homeowners and Solar Net Metering Requirements: What You Need to Qualify (Step-by-Step).

Winner: Net metering, for simpler setup and billing.

Long-Term Value and Risk

Long-term value combines the rate you earn, how long it lasts, and what could change. Net metering value can rise with retail electricity prices, which has been the pattern in many states, but it can also fall if a utility or regulator reduces export credits. Some owners report that adding a battery changes the picture by letting them store midday output for evening use, reducing reliance on exports. Comparisons with battery systems are covered in Dominion Energy Net Metering vs Battery Backup: Which Should You Choose?

A feed-in tariff gives more certainty during the contract but may end when it expires, leaving you to rely on a new arrangement. Check whether the contract renews, what happens at expiry, and whether the counterparty can change terms.

Because incentive programs and utility rules change, treat any long-term forecast as an estimate. A licensed solar installer or financial advisor can help you model scenarios for your specific utility.

Winner: Depends on risk tolerance. Net metering offers upside tied to retail rates. A feed-in tariff offers fixed returns for a defined period.

Which Should You Choose?

  • Choose net metering if your household uses most of its solar output during daylight hours and you want the simplest setup.
  • Choose net metering if your state offers full retail-rate credits and your utility has a stable tariff history.
  • Choose a feed-in tariff if you produce far more than you use and a fixed rate is clearly higher than your retail price.
  • Choose a feed-in tariff if you value a locked-in, predictable payment for a long contract term.
  • Consider neither alone if you want maximum self-consumption. Pairing solar with storage can reduce how much you depend on either credit.
  • Check availability first. If no feed-in tariff is open to new homes in your area, net metering is the practical choice regardless of preference.

Product Options for Each Setup

Your choice of export arrangement affects the equipment you need. Net metering typically requires a grid-tied inverter with utility-compliant anti-islanding protection and a bidirectional meter supplied by the utility. A feed-in tariff may require additional production metering. Most homeowners buy panels and inverters through an installer, who handles interconnection.

Net metering setup: a standard grid-tied string or microinverter system, sized to your annual consumption. View on Amazon

Feed-in tariff setup: a grid-tied inverter paired with a dedicated production meter, sized for maximum export. View on Amazon

Confirm with your installer and utility which inverter and metering models are approved before purchasing.

FAQ

Is a feed-in tariff the same as net metering?

No. Net metering credits your exports against your consumption, usually at or near the retail rate. A feed-in tariff pays a fixed rate for every unit exported, regardless of your own use.

Which pays more, feed-in tariff or net metering?

It depends on your utility and the contract. Net metering often pays close to retail, while a feed-in tariff pays a set rate that may be higher or lower. Compare the actual figures in your area.

Can I switch from net metering to a feed-in tariff?

Possibly, but it depends on whether your utility offers a feed-in program and whether you qualify. Contact your utility to confirm eligibility and any switching rules.

Do I need a battery with net metering?

No. Net metering works without storage. A battery can increase self-consumption and reduce reliance on exports, which some owners find useful.

Should I talk to a professional before choosing?

Yes. A licensed solar installer or energy advisor can review your utility’s current tariff, your usage pattern, and any pending rule changes. Consult a professional before committing to a long contract.

Conclusion

For most US homeowners, net metering is the stronger choice because it is widely available, simple to set up, and credits power at a value close to retail. A feed-in tariff makes sense when you export most of your output and the fixed rate is clearly better than your retail price for the full contract term. Start by checking which programs your utility offers, reviewing your daytime usage, and asking your installer to model both options with your actual numbers.

Claire Whitaker

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.