Arizona Net Billing in 2026: What Replaced Net Metering and What It Means for Your Bill

If you've searched "net metering Arizona" and walked away more confused than when you started, here's why: Arizona doesn't really have net metering anymore. It was replaced by net billing -- a system that pays you less for the power you send to the grid. The difference isn't just semantic. It changes your payback period, changes how you should size a system, and is the main reason solar installers keep mentioning batteries.

What net metering was

Under net metering, every kilowatt-hour you sent to the grid earned a full retail credit. Produce more than you use in June, get the same rate back in December. Clean 1-to-1 exchange.

Arizona's utilities started moving away from that in 2016, when the Arizona Corporation Commission changed the rules. APS switched in 2017, TEP in 2018. SRP held on longer but stopped enrolling new customers in net metering plans in late 2025. If you're going solar now, you're going under net billing.

What net billing actually pays you

Instead of a full retail credit, you get an export rate -- what the utility says your electricity is worth at the moment it hits the grid. That's a lot less than what you pay for power.

APS credits exported solar at about 6.2 cents per kilowatt-hour. Your retail rate runs around 12 cents. So every kilowatt-hour you push to the grid is worth roughly half of what you'd pay to pull one back.

SRP is lower: roughly 1.87 cents per kilowatt-hour for most new solar customers. SRP's old E-27 net metering plan came with a steep demand charge based on your peak 30-minute usage spike -- and it stopped taking new enrollments in late 2025 anyway.

TEP (Tucson Electric Power) sits around 5.13 cents per kilowatt-hour, against a retail rate near 15 cents. Exports there are worth about a third of what you pay.

One more thing: these export rates drop roughly 10% each September for new customers. Whatever rate you lock in at installation stays fixed for 10 years -- but someone going solar in fall 2026 gets a lower rate than someone who signed up in spring. That gap compounds over time.

How this changes your payback

The old net metering playbook was simple: size your system to cover your full annual usage, export the summer surplus, bank those credits for winter. You could run your bill close to zero.

Under net billing, that strategy costs you the spread. Exporting a kilowatt-hour at 6 cents during peak production, then pulling it back at 20 cents during APS's 4-7 PM on-peak window, means you lose money on that exchange every single time. Do that across a Phoenix summer and your payback period stretches.

The better approach now is self-consumption: use as much of your solar production in real time as you can. Run the dishwasher and laundry during the day. Pre-cool the house to 74F before the peak window hits so the AC runs less from 4-7 PM. Shift load toward daylight hours wherever possible.

That's a real change in behavior -- but it's also where the value actually lives under the current rules.

Why batteries changed the math

Consider a Phoenix home that generates 10 kilowatt-hours more than it uses on a typical summer day. Under net billing, those 10 kWh get exported and earn about 69 cents. With a battery, you store them and discharge during the 4-7 PM peak, avoiding grid electricity at roughly 20 cents per kWh. The same 10 kWh is now worth $2.00 in avoided costs -- nearly three times as much.

Spread that across a Phoenix summer and the math starts favoring a solar-plus-storage system over solar alone. The battery also protects you from future rate increases and keeps critical loads running during outages, which a solar-only system cannot do.

For SRP customers, a battery is closer to essential than optional. With on-peak hours running 2-8 PM on weekdays and demand charges based on your highest 30-minute usage spike, solar alone often can't touch the biggest drivers of your bill. A battery gives you actual control over when you pull from the grid.

What to check before you commit

A few things that often get skipped in sales conversations:

Your utility matters more than the panels. APS and SRP calculate savings completely differently. A proposal built on generic assumptions rather than your actual rate plan will be wrong in ways that look like rounding errors until year three.

The export rate drops each fall. Going solar this summer versus next fall isn't just about getting panels sooner -- it's about locking in a higher rate for the next 10 years.

APS has two TOU plan structures. TOU-E varies energy costs by time of day. TOU-Demand lowers energy rates but adds a demand charge based on your peak draw. Which one is better depends on your usage pattern, not your installer's preference.

Grandfathered plans exist. Pre-2017 APS customers and pre-2018 TEP customers may still be on original net metering terms. If you bought a home that already had solar, it's worth checking whether that plan transferred to you.

For more on what to expect from the installation side, see our guide to going solar in Scottsdale and how many panels a Phoenix home actually needs.

The short version

Arizona net billing pays you real money for solar -- just not as much as net metering did. APS credits you at about half your retail rate. SRP's credits are much lower. Both structures reward using your own power directly rather than exporting it, which is exactly why batteries are worth thinking about more seriously than they were five years ago.

The question for most Phoenix homeowners in 2026 isn't whether solar makes sense. It's whether solar alone makes sense, or whether adding storage changes the math enough to be worth the extra cost. In a lot of cases right now, it does.

Frequently Asked Questions

Does Arizona still have net metering?

Net metering has largely ended for new solar customers in Arizona. APS moved to net billing in 2017, TEP in 2018, and SRP stopped enrolling new customers in net metering plans in late 2025. Customers who signed up before those dates may still be on grandfathered plans.

What does APS pay for solar exports in 2026?

APS currently credits exported solar power at about 6.2 cents per kilowatt-hour -- roughly half of what you pay for grid electricity. This rate is locked in for 10 years at the time of installation, but new customers get a rate that drops about 10% each September.

What does SRP pay for solar exports?

SRP's export rate is about 1.87 cents per kilowatt-hour for new solar customers on standard net billing plans -- significantly lower than APS. SRP previously offered net metering with demand charges on its E-27 plan, but stopped enrolling new customers in late 2025.

Is a battery worth it under Arizona net billing?

It depends on your utility, but the math often works. Instead of exporting excess solar at 6 cents and buying it back at 20 cents during peak hours, a battery lets you store midday production and discharge it when electricity is most expensive. For SRP customers, a battery is close to essential for hitting meaningful bill savings.

How does net billing affect solar payback in Phoenix?

Under net metering, a well-sized system could theoretically zero out an annual bill. Under net billing, payback periods run longer because exported energy is worth less. Systems designed around self-consumption -- using solar directly rather than exporting it -- perform better under the current rules.