Arizona Net Billing 2026: What Replaced Net Metering and What Your Solar Export Credit Is Worth

What is net billing in Arizona and how did it replace net metering?

Arizona eliminated full retail-rate net metering in October 2017, when the Arizona Corporation Commission approved a shift to a net billing framework. Under the old rules, every kilowatt-hour your panels sent back to the grid earned you a credit equal to the full retail price you pay for electricity. Under net billing, your utility credits exported solar at an Avoided Cost Rate, a wholesale-like figure that reflects what the utility would have spent buying that power on the open market instead. The credits still reduce your bill, but they are worth considerably less per kWh than what you pay when you pull power from the grid.

The switch affects APS and SRP customers differently because each utility sets its own export rate. Knowing your number before you sign a solar contract is the single most important piece of math in the whole residential solar Arizona calculation.

What is the APS solar export rate for 2026?

APS credits exported solar at 6.171 cents per kWh through its Rate Rider RCP, confirmed by APS regulatory filings for the 2026 calendar year. The Arizona Corporation Commission caps annual reductions at 10 percent, which puts the floor at roughly 5.5 cents per kWh if the rate drops again in 2027.

To put that in context: most APS customers on a time-of-use plan pay somewhere between 16 and 33 cents per kWh depending on the hour they draw power from the grid. That gap is the core reason smart solar design in Phoenix leans toward maximizing what you use yourself rather than maximizing what you send back.

How does the APS export credit show up on a bill?

The RCP credit appears as a line item on your monthly statement, typically labeled something like Solar Export Credit or RCP Credit. Unused credits roll over to the next month's bill. At the end of the annual reconciliation period, excess credits expire rather than being paid out as cash, which is one more reason to size your system around your own consumption rather than running a large surplus. For a detailed look at how APS rate plan options interact with a solar system, the post on APS Solar Rate Plans in 2026 covers each plan and how homeowners get the most from them.

What is the SRP solar export rate in 2026?

SRP customers on the Time-of-Use Export plan receive a fixed credit of 3.45 cents per kWh for all exported generation, applied as a lump credit at the end of each billing cycle. That is roughly half the APS export rate, which matters a lot when you are comparing the economics of going solar across Phoenix Valley neighborhoods. SRP does not use the same sliding annual adjustment mechanism as APS, so the 3.45-cent rate is currently stable, though it is not guaranteed to stay fixed indefinitely.

If your address falls in SRP territory, the lower export credit makes self-consumption optimization even more important. A system sized to match your usage rather than overflow it will outperform an oversized one on the payback timeline under SRP's structure. For a side-by-side breakdown of how the two utilities stack up, APS vs SRP Solar Export Rates in 2026 walks through the numbers in detail.

Does the lower export rate mean solar is not worth it in Phoenix?

No, and the reason is in Phoenix's sun numbers. With 299 or more clear days per year and an average of 5.8 peak sun hours daily, a properly sized system offsets most of your consumption before the export question even arises. When your panels produce power while you are running the air conditioning in the afternoon, you consume that solar at full retail value, avoiding the 16-to-33-cent per kWh cost entirely. Only the surplus after your own needs are met gets exported at the lower avoided cost rate.

Phoenix summer bills regularly top $300 for a typical household. A system sized to cover 80 to 90 percent of annual usage typically exports only a modest fraction of its total output. Even at 6.171 cents per exported kWh, the savings from avoided grid purchases alone can reduce an APS bill by well over $100 per month in the summer, and considerably more for larger homes. Solar panels lower electric bills in Phoenix not primarily because of export credits, but because you stop buying expensive grid power at the hours when it costs the most.

How does net billing work for Phoenix Valley homeowners?

How does net billing work for APS customers in Phoenix, Scottsdale, and Chandler neighborhoods?

If your address is served by APS, you enroll in the RCP rider when your solar system is interconnected. After that, your meter tracks imports and exports separately. At the end of each billing period, APS applies the 6.171-cent export credit against whatever you owe for grid consumption. In summer months, a household running central AC heavily may import more grid power during the evening peak than its panels exported during the afternoon, so most APS solar customers still see a net charge on their bill. It is just a much smaller one. The goal is to save on APS bill with solar through avoided consumption, not through large export credits.

Note that APS and SRP serve Phoenix metro neighborhoods by address, not by city. Two houses on the same street can be on different utilities. The reliable way to confirm your provider is to check a recent utility bill before you start shopping installers.

How does net billing work for SRP customers in Gilbert, Mesa, and Tempe neighborhoods?

SRP territory covers large portions of the east and southeast Valley. Under the Time-of-Use Export plan, export credits accumulate throughout the billing cycle at 3.45 cents per kWh and apply in a lump sum at the end. Because the rate is flat rather than time-dependent, an SRP homeowner with solar does not benefit from shifting exports to particular hours the way an APS customer on a time-of-use rate can. The better lever is load management: running high-draw appliances during peak solar output hours so consumption happens when the panels are producing, not when the grid is.

SRP customers weighing residential solar in Arizona often find the prepaid lease structure appealing because it reduces upfront capital at the same 30-percent discount level, which softens the impact of the lower export rate on overall returns.

Why did Arizona end net metering?

The Arizona Corporation Commission approved the shift following utility arguments that full retail-rate net metering shifted grid infrastructure costs onto customers without solar. The avoided cost methodology calculates what the utility would have spent buying that same power wholesale, rather than giving solar owners credit for the full retail price that includes transmission, distribution, and fixed costs. Solar advocates disputed that framing, but the decision stood and has since served as a reference point for similar changes in several other Sun Belt states.

Homeowners who installed solar before November 2017 were grandfathered under the previous net metering rate for a fixed period. That window has largely closed for most early adopters depending on their interconnection date, though a small number of legacy accounts may still carry grandfathered terms. If you inherited a home with older solar, it is worth confirming with your utility which rate applies to your account.

What can Phoenix homeowners realistically save on solar under net billing?

The math changed when net metering ended, but it still works in the Phoenix market. A household using 1,200 kWh per month with a well-sized system might self-consume 900 kWh of solar output, avoiding roughly $180 to $270 worth of retail electricity purchases depending on the season and the hour of use. Export credits on surplus generation add a smaller additional benefit on top of that.

Reduce electric bill in Arizona by focusing on self-consumption, and net billing becomes far less of a constraint than it first appears. An independent solar advisor can model both APS and SRP scenarios for your specific address and usage history before you commit. The Solar Calculator gives you a baseline estimate to start with, and the team at Phoenix Valley Solar can run the full numbers using your actual bills.

How do I compare solar installers in Phoenix who understand net billing?

Comparing solar installers in Phoenix under net billing is not the same exercise it was under net metering. A sales rep focused on maximizing system size may pitch the largest number of panels because that drove better returns when every exported kWh came back at retail credit. Under net billing, that approach can leave you exporting cheap credits instead of offsetting expensive consumption, extending your payback period by years.

The best solar installer for a Phoenix home under net billing is one who starts with your actual usage data, models your consumption at the hourly level, and sizes the system around what you will consume rather than what the roof can hold. An independent solar advisor in Phoenix runs that analysis across multiple vetted installers rather than for a single company's product line.

Phoenix Valley Solar is a solar broker in Arizona, not an installer. That means we have no financial reason to push one contractor or one system size. We compare competing bids, explain the net billing math in plain terms, and let you make the call. Learn more about how the broker model works on the About page, or read how Phoenix homeowners find reputable solar contractors without the pressure.

How does the prepaid solar lease work with Arizona net billing?

The prepaid solar lease at a 30-percent discount is one of the more compelling options for Phoenix homeowners who want predictable savings without a large capital outlay. Here is how it interacts with net billing: the leasing company owns the panels and can claim the 48E commercial investment tax credit through 2027, then pass that benefit to you as a lower upfront payment. The effective discount works out to the same 30 percent that the Section 25D residential credit offered to owner-buyers before December 31, 2025.

Homeowners who missed that 2025 deadline can still access the same 30-percent reduction through the prepaid lease structure. The export credits under net billing flow to your utility account in the same way regardless of whether you own or lease the panels, so the 6.171-cent APS rate or 3.45-cent SRP rate applies equally. With lower capital at risk, the reduced export rate becomes less of a concern when you run the long-term numbers. This is not tax advice; consult a qualified tax professional about your specific situation. For a detailed comparison of the prepaid lease against a loan over 25 years, see Prepaid Solar Lease vs Loan in Arizona.

If you want to understand how to save 30% on solar in 2026 without relying on an expired owner-buyer credit, the prepaid lease is the current path. Get a no-pressure quote at Phoenix Valley Solar and we will walk through both the ownership and lease numbers side by side.

How do I get solar quotes in Phoenix that account for net billing?

Getting solar quotes in Phoenix means more than just comparing panel brands and system sizes. You want proposals that show you the self-consumption model, the estimated export volume, and what the avoided-cost credit adds to your total savings projection. Any installer or broker who cannot show you that breakdown is giving you an incomplete picture.

Start with the Solar Calculator to get a sense of how much your Phoenix home could produce and what the net billing math looks like for your typical usage. Then reach out to us at Phoenix Valley Solar for a solar consultation in Phoenix with no sales pressure and a clear comparison of competing bids. We work across both APS and SRP neighborhoods throughout the Valley, from Scottsdale to Chandler to Gilbert to Tempe, and we explain the export credit numbers before you sign anything.

Frequently Asked Questions

What replaced net metering in Arizona?

Arizona replaced full retail-rate net metering with net billing in 2017. Under net billing, APS credits exported solar at 6.171 cents per kWh and SRP credits it at 3.45 cents per kWh, rather than the retail rate homeowners pay when buying power from the grid.

What is the APS solar export rate in 2026?

APS pays 6.171 cents per kWh for solar exported to the grid in 2026 through its Rate Rider RCP. The Arizona Corporation Commission limits annual reductions to 10 percent, giving the rate a regulated floor year over year.

Is solar still worth it in Arizona under net billing?

Yes. Phoenix homeowners self-consume most of their solar output, avoiding 16 to 33 cents per kWh in retail grid costs before export rates matter. With 5.8 peak sun hours daily and summer bills over $300, savings from avoided consumption typically justify the investment.

How does an independent solar advisor in Phoenix help with net billing?

An independent solar advisor compares quotes from multiple vetted installers and models your system around self-consumption, not maximum panel count. That directly addresses the lower export rate under net billing and avoids the oversizing trap common with single-company sales reps.

Can I still get the 30% solar discount if I missed the 2025 tax credit deadline?

Yes. The Section 25D residential credit expired for owner-buyers after December 31, 2025, but the prepaid solar lease lets the leasing company claim the 48E commercial credit and pass the savings to you as a 30% discount. Consult a tax professional for advice on your situation.

How do I compare solar installers in Phoenix under net billing rules?

Ask each installer to show a self-consumption model, not just total system output. Under net billing, oversized systems export cheap credits instead of offsetting expensive consumption. A solar broker in Phoenix compares vetted bids and explains the net billing math before you commit.