Understanding Net Metering for Landlords: A Guide to Maximizing Solar Income

Idan Shahar
Updated on
October 4, 2023
5 min read


In the ever-evolving world of real estate, landlords are continually seeking innovative ways to maximize income from their rental properties. One such avenue gaining popularity is the installation of solar panels. Beyond the environmental benefits, solar panels offer landlords the potential for a significant income stream. To fully grasp how to leverage this solar investment, it's essential to understand a crucial concept: net metering.

What is Net Metering?

Net metering is a billing arrangement that empowers property owners, including landlords, to receive credit for surplus electricity generated by their solar panels and returned to the grid. This credit offsets electricity costs when solar panels are inactive, such as at night or on cloudy days.

How Does Net Metering Work?

Understanding the mechanics of net metering is vital:

  1. Solar Panel Generation: Solar panels generate electricity during sunny periods, fulfilling the property's electrical needs, including common areas and shared amenities.
  2. Excess Electricity: If the panels produce more electricity than the property consumes, the surplus flows back into the grid. A bi-directional utility meter tracks this excess energy.
  3. Credit Accumulation: As surplus electricity is sent to the grid, credits accumulate. These credits represent stored kilowatt-hours (kWh) that can offset future electricity costs.
  4. Cost Offset: When solar panels aren't generating enough electricity, such as at night, the property draws power from the grid. At this point, accumulated credits are applied, potentially reducing or eliminating electricity bills.

Benefits of Net Metering for Landlords

  1. Reduced Electricity Costs: Net metering lowers electricity expenses, increasing rental property income.
  2. Income Generation: By selling excess energy back to the grid, landlords can generate additional income, enhancing the solar investment's returns.
  3. Tenant Attraction: Solar panels and the prospect of lower electricity bills can attract environmentally conscious tenants, potentially boosting tenant retention and property value.
  4. Environmental Impact: Utilizing clean energy and reducing carbon emissions contributes to a greener, more sustainable future.

Challenges and Considerations

While net metering offers substantial benefits, landlords must consider:

  1. Regulations: Net metering rules and incentives differ by location, so understanding local regulations is essential.
  2. Billing Structure: Collaborate with the utility provider to ensure the correct billing structure for net metering.
  3. Panel Maintenance: Routine solar panel maintenance is crucial to maximize energy generation.


Net metering is a valuable tool for landlords seeking to optimize solar panel investments on rental properties. It not only decreases electricity costs but can also generate additional income, benefiting both landlords and tenants. To begin, consult solar panel installation experts and your utility provider to comprehend the specific net metering options in your area. By doing so, you can harness solar power to enhance property income while fostering a sustainable living environment for tenants.

If you're interested in learning more about how to charge tenants for solar energy, check out our guide on the topic.

Idan Shahar
CEO & Co-Founder