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Will I Still Have an Electric Bill with Solar Panels?

Dan Heckathorn October 30, 2024 7 min read

Switching to solar is a big step in cutting down monthly expenses and minimizing dependence on traditional electricity. Many homeowners choose solar with the hope of eliminating their electric bills entirely, but the reality is often a bit more complex. Solar panels can indeed slash energy costs dramatically, but a few factors—like where you live, your electric company’s policies, and the type of system you have—play a role in whether you’ll still receive an electric bill. Let’s break down why some solar customers still receive a bill, what factors influence these charges, and how much you might expect to pay each month.

For educated consulting on whether you would be able to reduce or eliminate your electric bill in your home, contact us at Eagle Mountain Solar for a free consultation with a solar expert!

Key Factors That Affect Your Electric Bill with Solar

1. Solar Offset: How Much of Your Energy Needs Are Covered?

The concept of solar offset is key to understanding your potential electric bill. Offset refers to the percentage of your home’s energy that your solar system covers. If your solar system is sized to meet 100% of your energy usage, you’re more likely to see a $0 bill some months of the year. However, even systems designed to offset all usage are often slightly affected by seasonal production shifts or increased household demand.

Achieving 100% offset can depend on:

The size of the solar system
The orientation and angle of the solar panels
Local weather patterns and seasonal sunlight levels

Most households aim to install a system that covers the bulk of their energy needs, but many homeowners find that, while solar greatly reduces their electricity costs, occasional small bills may still appear.

2. State Regulations and Net Metering

Your state’s solar regulations and net metering policies play a significant role in your potential savings. Net metering is a policy that allows homeowners to earn credits for any excess energy their solar panels produce. During sunny months, if your system generates more electricity than you use, the surplus is sent back to the grid, and you receive credits that reduce your future bills.

How Net Metering Affects Your Bill:

In states with full retail net metering, you earn credits at the same rate as you pay for electricity, which can lower or even zero out your bill during certain months.
Some states, however, offer only partial credit for the electricity you send back, or even none at all, making it harder to eliminate your bill fully.

Each state sets its own net metering policies, which can vary widely. States with strong net metering policies, such as Maryland, Minnesota, and others tend to favor homeowners by making it easier to achieve zero-dollar bills for at least part of the year.

3. Electric Company Policies

Even within states with robust net metering laws, utility companies have unique policies that impact solar customers. While some utilities offer full bill credits for excess solar power, others have limits or impose fees that make it difficult to reach a zero-dollar bill. Some utilities require additional charges for grid access, even if you’re not drawing power from the grid.

This is especially true in Texas where it is deregulated so you not only deal with the TDU but also the REP or retail provider who you are able to shop around for.

Examples of Utility Policies:

Some companies offer credits but don’t let them roll over.
Many companies in CA offer “annual true-up,” meaning they only bill you once a year based on what your solar system didn’t cover which means you could have no electric bill the whole year then one larger bill at the end.

It’s always a good idea to consult with your utility provider to understand their specific solar policies and billing structure before going solar.

Fixed Monthly Connection Fee

One of the main reasons that a $0 bill is rare for most solar customers is the fixed monthly connection fee. This fee is generally charged by utility companies to keep you connected to the grid, even if you rarely use grid power. These fees cover the cost of maintaining the power lines and infrastructure, ensuring electricity access whenever needed.

Fixed fees vary by location and utility provider but generally range between $10 and $15 per month. Although it’s a small charge, this connection fee means that achieving a truly zero-dollar bill every month is challenging unless you go entirely off-grid, which requires additional equipment like battery storage.

Seasonal Fluctuations

In addition to connection fees, seasonal fluctuations can influence whether you’ll see a bill in certain months. Solar panels produce more electricity during sunnier months and less during winter when days are shorter and cloud cover may be higher. Even if your system offsets 100% of your annual usage, your winter solar production may not be high enough to cover all of your usage in those months.

Summer and Winter Production Differences

In summer months, many solar systems produce more energy than needed, especially in sunny states. This surplus often results in credits if you have net metering, which can be applied to future bills.
In winter months, energy needs may be higher, and solar production typically dips, which may lead to a small electric bill even with solar.

For homeowners with net metering, the credits earned during high-production months can help offset these winter bills. However, this varies by state and utility company. In states without robust net metering, winter months often see a slight uptick in bills, even with a fully functional solar system.

How Likely Are Zero-Dollar Bills with Solar?

Zero-dollar bills are possible, especially for homeowners in states with favorable net metering and high solar offset. However, due to connection fees and natural production fluctuations, it’s realistic to expect that most months will include a small charge, typically in the range of $10 to $15. Even in the best conditions, achieving a zero-dollar bill may only happen during peak production months, especially for grid-connected systems.

To maximize your chances of low or zero-dollar bills, consider:

Investing in a battery system, which can store excess energy produced in the day to cover winter needs and negate utility buyback policies.
Working with your solar installer to ensure your system is sized to meet as close to 100% or higher of your energy usage.
Reviewing your utility’s net metering and billing policies to understand how credits are applied.

Conclusion: Solar Greatly Reduces Bills, But Small Charges May Remain

Switching to solar is one of the most effective ways to lower your monthly electric expenses, and for many homeowners, solar reduces electric bills significantly. While it may be difficult to eliminate your bill completely, most solar customers enjoy much lower charges than they would with traditional electricity. Small, residual charges are often tied to grid connection fees or seasonal production changes, but they’re minimal compared to the savings.

Whether your goal is to lower energy costs, reduce your carbon footprint, or gain energy independence, going solar is a smart choice. And while some months may come with a slight electric bill, the investment in solar offers a return in both financial and environmental benefits that make it worthwhile.

For educated consulting on whether you would be able to reduce or eliminate your electric bill contact us at Eagle Mountain Solar for a free consultation with a solar expert!