Solar FAQ
What Is Net Metering and How Does It Work in Canada?
Net metering is the single biggest factor in your solar ROI. Here’s how it works in each province – and why the rules matter more than panel price.
Net metering lets you send excess solar electricity back to the grid in exchange for credits on your electricity bill. When your panels produce more than your home uses, the surplus flows to the grid and your meter effectively runs backwards. At night or on cloudy days, you draw from the grid as usual. You only pay for the net difference. Most Canadian provinces offer net metering, but the rules – especially how credits are valued and when they expire – vary significantly.
How Net Metering Works: The Basics
- Your solar panels produce electricity during daylight hours.
- Your home uses what it needs in real time.
- Surplus flows to the grid. Your utility meter tracks the export.
- At night/cloudy periods, you import from the grid as normal.
- Your bill reflects the net difference between exports and imports.
If you export more than you import, you carry a credit forward. The key variable is how your utility values your exports – from full retail rate (1:1, best) to wholesale rate (much less). This single factor can shift your payback period by 2–5 years.
Net Metering Rules by Province
| Province | Credit Rate | Reset | Max Size | Notes |
|---|---|---|---|---|
| ON | 1:1 at retail | Annual (Apr) | 500 kW | Generous. Credits offset delivery charges in some LDCs. |
| BC | 10¢/kWh (Apr 2026) | Annual (Apr) | 100 kW | New Rate Schedule 2289 replaces old 1:1. |
| AB | Varies by retailer | Monthly | 150 kW | Deregulated. Some 1:1, others not. |
| SK | 1:1 at retail | Annual (Apr) | 100 kW | Straightforward. Annual true-up. |
| QC | ~Retail rate | Annual | 50 kW | Cheap hydro rates reduce financial impact. |
| NS | 1:1 at retail | Annual | 100 kW | Strong NM + SolarHomes rebate. |
| MB | 1:1 at retail | Annual | 200 kW | Low rates reduce absolute savings. |
| NB | 1:1 at retail | Annual | 100 kW | Reasonable program. |
| PEI | 1:1 at retail | Annual | 100 kW | Good for the Maritimes. |
| NL | 1:1 at retail | Annual | 100 kW | Available but limited installer market. |
BC’s Big Change in 2026
Effective April 1, 2026, BC Hydro’s new Rate Schedule 2289 compensates excess generation at 10¢/kWh – significantly less than the old 1:1 retail credit. This makes batteries and self-consumption more important for BC solar homeowners. Read our full BC Hydro analysis
Annual vs. Monthly Reset: Why It Matters
Most provinces use annual net metering with a spring reset (typically April):
- Summer surplus carries forward. You overproduce May–August and bank credits.
- Winter deficit uses those credits. You draw more November–February.
- At annual reset, remaining credits expire or are paid out at a reduced rate.
A well-sized system aims for near-zero credits at the April reset – annual generation roughly equals annual consumption.
Monthly reset (some Alberta retailers) is less favourable because summer credits can’t carry forward to winter.
Net Metering vs. the Ontario HRS Rebate
Ontario homeowners face a unique either/or: systems receiving the HRS rebate (up to $5,000 solar + $5,000 battery) cannot participate in net metering. These must be configured for load displacement only.
Which is better depends on your situation:
- Net metering usually wins for larger systems that overproduce, homes without batteries, and long-term ROI focus.
- HRS rebate may win if adding a battery anyway, consumption is high enough you rarely export, or you want to minimize upfront cost.
See our detailed Ontario incentives comparison →
How Net Metering Affects Your Payback Period
- 1:1 NM + high rates (Ontario, Nova Scotia): 7–10 year payback.
- 1:1 NM + low rates (Quebec, Manitoba): 14–20+ year payback.
- Reduced export rates (BC post-April 2026, some AB retailers): Payback increases 2–4 years vs. 1:1. Self-consumption and batteries become more important.
Related Questions
How much do solar panels cost? $2.50–$3.80/W installed. Net metering quality determines whether that pays off in 8 years or 15. Cost FAQ
Do I need a battery? If your province has good net metering, usually no. Battery FAQ
What incentives are available? Provincial rebates of $5,000–$10,000 can reduce out-of-pocket cost. Incentives FAQ
Incentive amounts, program eligibility, and electricity rates referenced in this article are current as of March 2026 and subject to change. Verify details with your provincial program administrator before making financial decisions.
See How Net Metering Works for Your Home
The value depends on your utility, rate plan, and system size. Get a free quote with estimated production, exports, and savings. Get Your Free Solar Quote