Why Is My Electric Bill Still High With Solar?

A high electric bill after going solar usually comes down to one of six things: fixed charges that solar can’t erase, low credits for the power you export, a system that isn’t producing (or isn’t approved to run yet), higher household usage, an annual true-up bill, or a rate plan change. Some of these are normal and some mean something’s wrong. The fastest way to find out is to compare what your system actually produced with what it should have produced, then read your bill line by line.

First: check whether the system is producing

Before anything else, rule out the expensive problem. Open your monitoring app or look at the inverter display and note how many kWh the system made last month. Then compare it to an estimate for your location and system size using our production checker, which uses the same kind of model as the PVWatts calculator from the National Laboratory of the Rockies (formerly NREL).

What you see	What it likely means
Production within about 10% to 15% of the estimate	System is fine; the bill issue is elsewhere
Production 20% or more below estimate for several months	Possible fault, shading, soiling or design issue
Zero production, or the app shows no data	Inverter off or failed, tripped breaker, or a monitoring connection problem
Production looks normal, but the bill shows little or no export credit	Billing or meter setup issue; call the utility

If production is low, see is my solar system working? for a step-by-step diagnosis.

Reason 1: fixed charges solar can’t touch

Most utilities charge a fixed monthly customer or service charge, and some add minimum bills, demand charges or solar-specific fees. These stay the same no matter how much power you make. Taxes and some per-kWh surcharges may also apply to power you draw from the grid even if credits offset the energy cost.

A real example from our state data: Alabama Power charges customers with their own generation a capacity reservation charge of about $5.41 per kW of system size per month. On a 7.2 kW system that’s about $39 a month, before the regular base charge.

This is why we flag the zero electric bill promise as a red flag. If a salesperson told you your bill would be $0, the problem may be the promise, not your system.

Reason 2: your exports earn less than you thought

Solar panels produce most in the middle of the day, which is often when you’re using the least. The extra goes to the grid. How you’re credited for it makes a big difference.

• Full retail net metering: each kWh you export offsets a kWh you buy later at roughly the same value. Your bill drops close to the fixed charges if the system is sized to your usage.
• Net billing or avoided-cost credits: exports earn a lower rate, sometimes a small fraction of retail, while you still pay full price for power you buy in the evening. California’s Net Billing Tariff, for systems applied for since April 15, 2023, credits exports at hourly avoided-cost values. Idaho Power, Illinois utilities, Duke Energy in North Carolina and others have also moved away from full retail credits.

Worked example with round numbers: say your system makes 800 kWh in a month, you use 300 kWh of it directly, and you export 500 kWh. At night you buy 500 kWh at 30 cents.

• Under full net metering, the 500 exported kWh cancel the 500 bought. Energy cost: about $0.
• Under net billing at 5 cents per exported kWh, you get $25 in credit against a $150 purchase. Energy cost: about $125.

Same panels, same production, very different bill. See net metering explained, California net billing (NEM 3), and our net metering by state data.

What helps under net billing: running dishwashers, laundry, pool pumps, water heating and EV charging during sunny hours, and in some cases a battery. Check the battery math with our battery calculator and do solar batteries pay off?.

Reason 3: you don’t have Permission to Operate yet

After installation, your system usually can’t legally run until your utility grants Permission to Operate (PTO). Until then, you pay your full utility bill. If your solar loan payments have also started, you’re paying twice. This is one of the most common reasons new solar owners see high bills.

Check for a PTO letter or email, and look at whether your utility has installed a bidirectional (net) meter. If it’s been more than a few weeks since inspection, ask your installer and utility where the application stands. Our interconnection and PTO guide covers what to ask, and the PTO delays and payments before PTO pages explain the risks.

Reason 4: you’re using more electricity

Solar sized for last year’s usage won’t cover a bigger load. Common causes:

• A new EV (often adds hundreds of kWh a month). See solar and EV charging.
• A heat pump or electric water heater replacing gas
• A hot summer or cold winter, more people at home, a pool, a hot tub or a home office
• “Solar complacency”: running the AC harder because the bill is supposed to be covered

Compare your total usage (grid purchases plus solar used on site) to the same months last year. Your monitoring app may show consumption if a consumption meter was installed; if not, a home energy monitor can show where power goes. See our cheaper first steps and efficiency before solar for ways to trim usage.

Reason 5: the annual true-up arrived

Some utilities settle solar accounts once a year. Month to month you may only pay fixed charges, while energy charges and credits accumulate. At the true-up date, you get one bill for any net cost. Owners who weren’t warned often get a shock of hundreds of dollars.

To avoid surprises, look at the running balance on each monthly statement, which most true-up utilities show, and set money aside. Credits that build up in summer may be used up by winter.

Reason 6: your rate plan changed

Going solar sometimes moves you onto a different rate: a time-of-use plan with expensive evening hours, a solar-specific tariff, or a plan with higher fixed charges and lower per-kWh rates. Under time-of-use rates, the power you buy at 6 to 9 p.m. can cost much more than midday power. Ask your utility which rate you’re on and whether another option would be cheaper for your usage pattern. See time-of-use rates and solar.

Reason 7: the system was undersized or overpromised

Sometimes the system works exactly as designed, but the design or sales estimate was unrealistic: production ignored shading, the roof faced the wrong way, or the proposal assumed rate increases or usage that didn’t match reality. See inflated production estimates and inflated rate increases.

Find your original proposal and compare its expected annual kWh to your first full year of production. If your system has a production guarantee, check how the shortfall is calculated and paid, and file a claim if you qualify. Many guarantees reimburse at a low rate or only after several years, so read the terms. See weak production guarantees.

How to read your bill line by line

Grab a recent bill and look for:

1. Fixed or customer charge: the same every month.
2. Energy delivered: kWh you bought from the grid, often split by time-of-use period.
3. Energy received: kWh you exported. If this is zero on a sunny month, call the utility; your meter or account setup may be wrong.
4. Export credit rate: what each exported kWh is worth.
5. Net energy charge or credit: the balance for the period.
6. True-up balance: running total if your utility settles yearly.
7. Taxes, surcharges and non-bypassable charges: charges that apply even when credits cover energy.

Then add your solar loan, lease or PPA payment. The real question isn’t “is my utility bill zero?” but “is my utility bill plus my solar payment less than what I’d pay without solar?”

Bottom line: A bill that’s lower but not zero is normal. A bill that’s the same as before solar, with no export credits, is not. That usually means no PTO, a failed system, or a billing setup error, and each of those can be fixed.

When to escalate

• System producing far below estimate: contact your installer or a new servicer. If your installer is gone, see what to do if your solar company went out of business.
• No PTO after inspection, or billing not reflecting exports: contact your utility’s interconnection or net metering department in writing.
• Savings were clearly misrepresented: gather your proposal and file complaints with your state attorney general and, for loans, the CFPB. See our solar scams guide.

To see what savings should have looked like for your home, run your numbers in the solar calculator and review how prices have moved with the electricity rate history tool.