Understanding Your “True-Up” Statement

The True-Up Statement can sometimes be confusing to new solar owners. This article is intended to help answer common questions many new solar users have.

Homeowners who go solar will see some changes to their utility bill. You will still get a monthly statement from your utility, but won’t be actually billed for your electricity usage until the anniversary of the date the utility switched on your solar system. At that time, the utility will send you a “True Up” Statement.  The True-Up Statement will include your annual utility bill, and a summary of your net electricity use.

Background on net metering

All utility customers have a meter which reads off how much power you use and when, so the utility can bill you appropriately. Solar users make their own power when the sun shines, send any surplus energy back to the grid, and usually also buy electricity from the utility when the sun isn’t shining. You pay the utility for energy you use from the grid when the sun isn’t shining, minus the credit you receive for the solar energy you send back to the grid. That process is “net metering.”

What happens when the sun is shining

  • During high solar production months, your solar panels will likely produce more energy than you consume. In those months, your extra energy will be sent back to the grid and “banked” as a credit for you to use in the future.
  • Your credit is set as the same rate the utility sold your extra energy to your neighbors (retail rate), minus a few cents to pay for various utility programs.
  • Your “net” energy use will be a negative number.

What happens when the sun isn’t shining

  • During low solar production months and anytime the sun isn’t shining, you likely consume some electricity from the grid.
  • In those months, any extra energy credits you previously “banked” will get applied.
  • Your “net” energy use will be a positive number.

Your month-to-month statement from the utility

No matter what, you will always incur monthly charges for grid usage and connection fees. In addition, your monthly statement will also list your net energy usage. It will read as either a charge or a credit. These charges and credits are carried through until True-Up.

Your annual True-Up statement

The True-Up statement is what the utility sends solar users on the anniversary of the date your solar system turned on. The True-Up reconciles all the cumulative energy charges and credits and compensation for an entire 12-month period.

  • If a balance is due after all credits and charges are reconciled, the amount will appear on the True-Up statement.
  • If your system produced more energy than you consumed over the 12-month billing cycle, you will receive a small credit on your True-Up bill of between 2 to 4 cents per kilowatt-hour for any leftover energy, your “bank” is cashed out, and you start the annual cycle over again.
  • The “True-Up rate” is lower than the rate you receive for the extra solar energy you share throughout the year. In 2016 the utilities lobbied to gut the True-Up rate. Now they are lobbying to gut the rate your excess energy gets during the rest of the year and we’re fighting back hard.

Consumer tip: Make sure to set aside funds every month for your True-Up bill

Make sure to remember that you might need to pay a True-Up and set aside some of your solar savings for that. This way you avoid an unplanned bill.

Important Data Points on Your True-Up Bill

Your True-Up statement will include:

  • The electricity your solar system produced over the course of the year  (measured in kilowatt hours, or kWh).
  • How much electricity you bought from the grid, and how much of that was covered by your net metering credits.
  • The retail electricity rate used to value the accrued credit.
  • The amount of any leftover solar energy credits, and the amount owed to you.
  • The total amount you must pay the utility company.

What is the Difference Between My Monthly Bill and My True-Up Bill?

After going solar and knowing you will have an annual True-Up bill, consumers often ask why they still receive a monthly utility statement.  Monthly statements from the utility includes minimum monthly due delivery charges. Additionally, the monthly bill allows homeowners to track toward the annual True-Up, with a snapshot of current and year-to-date charges and credits.

A Learning Curve at True-Up

Taking a few minutes to understand the difference between a standard bill and a bill that you will see once you go solar, on both a monthly and an annual basis is important. If you find you still have lingering questions regarding your bill, reach out to your local solar installer for additional guidance to ensure you are confident in the documents you receive from the utility.