Going solar can yield huge savings on electricity bills. But many homeowners are surprised when they receive a large “true up” bill at the end of their first year. This settlement statement reconciles your solar production with utility grid usage. If you consumed more electricity than your solar panels produced, you’ll owe your utility company.
Don’t panic if you get hit with a high true up charge. With the right approach, you can pay off the balance and avoid future surprises. Here are smart strategies to cover a solar true up bill:
Understand How True Up Bills Work
The first step is educating yourself on what exactly a true up statement is. When you install solar panels, you’re switched to net metering billing. This tracks both the energy your solar system produces and what your home draws from the grid.
At the end of your 12-month billing cycle your utility calculates whether you produced a surplus or shortfall of power. If your consumption exceeded production you’ll be billed for the net amount of grid energy used. This is your true up charge.
Knowing how the billing works helps you make changes to produce a smaller true up, or even a credit.
Pay in Installments
If you receive a large true up bill you can’t cover in one payment, call your utility immediately to request paying in installments. Most will grant a payment plan if you have a good history.
Just be sure the terms fit your budget Get any plan in writing before the bill due date passes, This avoids penalties and maintains uninterrupted electrical service
Use Overproduction Credits
Some utilities allow excess solar production credits to be applied to your true up bill. Check if you accumulated credits that can offset what you owe. Credits leftover will roll over and reduce next year’s statement.
Utilize overproduction credits to chip away at a big true up charge without added expense. But don’t rely solely on this if you expect an ongoing deficit.
Upgrade Your Solar System
A true up charge often means your solar array was undersized for your home’s needs. The solution is adding panels to increase production. Purchase additional capacity or upgrade through a solar loan or PPA.
Run the numbers to right-size your system. Oversizing can yield years of overproduction credits to offset future usage spikes.
Reduce Grid Dependence
Lower your true up by decreasing grid power consumption. Simple lifestyle changes like running large appliances at peak solar production times can help significantly.
Also consider adding solar batteries to store surplus energy for nighttime use. The more you rely directly on your solar system, the lower your net utility usage will be.
Pay from Your Emergency Fund
Don’t resort to high-interest financing or credit cards to cover a true up bill. If you have an emergency fund, use it to pay off the balance without accruing debt.
Replenish the fund over time. Having reserves prevents desperation when an unexpected bill hits.
Ask for Bill Forgiveness
If your true up stems from a solar system defect covered by warranty, ask your utility for bill forgiveness. Provide documentation showing the issue was beyond your control.
Most will grant one courtesy non-payment, especially if you get the system fixed promptly. Just don’t expect leniency for ongoing production shortfalls.
Apply a Refund or Rebate
Some utility companies offer solar bill rebates and incentives. If you have any credits or refunds coming, request they be applied to offset your true up charge first.
Every dollar counts when facing a high balance. Take advantage of any credits available before paying out of pocket.
Take a Short-Term Loan
As a last resort, consider a small short-term personal loan to pay off the balance if you qualify. Compare interest rates and terms across multiple lenders.
While not ideal, a brief loan helps avoid late fees, service disruption or damage to your credit score. Just be sure you can repay it quickly.
Prevent Future True Up Headaches
Moving forward, implement strategies to avoid additional true up surprises:
-
Monitor your net usage regularly to catch problems early.
-
Reduce energy consumption with efficiency upgrades.
-
Add battery storage to increase self-supply.
-
Oversize your solar array to produce a surplus.
-
Repair any system issues immediately under warranty.
Take advantage of overproduction credits, rebates, and payment plans to cover a surprise true up bill painlessly. But most importantly, take preventive steps to ensure your solar system exceeds your home’s annual energy needs. With proper planning and monitoring, you can avoid future true up headaches.
Staying on top of your utility net metering statement is key to smooth solar billing. While it may take getting used to the new way your power is metered and billed, a little education goes a long way. You’ll soon be a pro at managing your annual true up!
Solar True-Up Payment Definition
By definition, a solar true-up is the annual payment that an energy utility will send a solar producer for the accumulation of credits not yet redeemed on monthly bills. Whereas the precise details of how specific utility solar programs work vary across the country, most true-up payments follow generally the same structure, format, and procedures. In some areas, true-up payments may not exist when bill credits are allowed to roll over indefinitely.
How is a solar true-up calculated?
Unlike monthly net metering credits, the excess electricity credits redeemed in a solar true-up payment are typically calculated using “avoided cost rates.” According to the Solar Rights Alliance, this will typically translate to two to four cents per kilowatt hour, which is significantly lower than average US retail electricity prices (roughly $0.17 per kilowatt at the end of 2023).
How to Understand My PG&E True Up
FAQ
Can you make payments on your true up bill?
How does the true up bill work?
How to lower true up bill?
What happens if my true up bill is negative?
What is a true-up Bill?
To put this another way, the true-up bill collects and reconciles your annual, cumulative energy charges, credits and any net generation compensation you may be entitled to receive for the billing cycle. If, after the utility provider reconciles your credits, you still have a balance due, the true-up statement will reflect that.
What happens if a balance is due on a true-up Bill?
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. The credit will be between 2 to 4 cents per kilowatt-hour for any leftover energy.
Do I have to pay my utility balance before true-up?
Even though NEM1 and NEM2 customers don’t have to pay their utility balance until True-Up, we don’t recommend that you wait. If you see a balance on your monthly statement, pay it then. This avoids any surprises at True-Up. As stated earlier, NEM3 customers are already required to pay any balances monthly. Your True-Up statement will include:
What is a true up statement?
What is a True Up? What is a True Up? After 12 months, you will receive a final statement of your billing cycle which is called a True-Up Statement. The statement provides your net energy charges and credits over the entire year and shows any final balance due.
How do I know if my PG&E bill is true-up?
The statement also tells you how you are tracking towards your True-Up. Just look at your “Solar True-Up Tracking” box. It also contains a snapshot of your current and year-to-date charges and credits. As a solar or renewable energy customer, you receive a monthly PG&E bill.
What is your annual true up Bill?
That charge for supplemental electricity usage is what is known as your annual true up bill. It might sound confusing but it’s actually pretty simple. Your annual true up statement is tallied up based on the solar system’s energy production and the homes electricity usage.