Using Solar First, Then Selling Excess Energy

This is the most common way homeowners use solar. You prioritize using your solar energy first and sell the extra power to the grid at a fixed rate. You consume solar energy in real-time, reducing your reliance on grid electricity. Any excess power is sold to the grid at a set rate, which varies depending on your utility’s program. Your earnings depend on how much excess power you generate and how it’s credited.

There are different ways your utility might compensate you:

• Feed-in Tariffs (FiTs) – Utilities pay a fixed, guaranteed rate per kilowatt-hour (kWh) for your exported solar energy.

• Avoided Cost Payments – You are paid based on the utility’s cost of generating additional electricity (often lower than retail rates).

• Net Billing – You sell excess energy at a fixed rate lower than what you pay for grid power.

• Net Metering (1:1 Credit) – In some areas, exported energy is credited dollar-for-dollar at the same rate you pay for electricity.

Example: The Homeowner Selling Excess Solar

Maria, in Florida, installed solar panels and signed up for net metering. During the day, her panels produce more energy than she uses. That excess energy flows into the grid, earning her credits on her electricity bill. At night, when her solar isn’t generating power, she draws from the grid using those credits.

The trade-off?

• If she had net billing instead of net metering, she wouldn’t receive full value for the energy she exports, lowering her savings.

• If she were on a Feed-in Tariff, she’d be paid for every kWh exported but wouldn’t be able to directly use her own solar power.

For many homeowners, selling excess energy to the grid provides a reliable way to offset costs—but the compensation depends on local policies.