How Net Metering Works in Ontario [Simple Homeowner Guide]

Eric
May 7
3 min read

What Is Net Metering?

Net metering is a billing system that allows Ontario homeowners with solar panels to send unused electricity back to the grid and receive credits on their hydro bill.

In plain terms:When your solar system produces more electricity than your home uses, the extra power is sent to your local utility, and you earn a 1:1 credit for every kilowatt-hour (kWh). You can then use those credits later — like at night or during the winter — when your solar production is lower.

Net metering helps homeowners reduce or eliminate electricity bills over the course of the year. It’s a core reason why solar power is a smart financial investment in Ontario.

How It Works Month-to-Month

Ontario’s seasons affect solar production — so net metering balances things out over time.

In the summer, your solar panels produce more electricity than your home needs. That extra energy goes to the grid and builds up credits in your utility account.
In the winter, when there’s less sunlight and more energy usage (heating, lighting), you use those credits to cover your electricity needs.

You’re essentially “banking” excess solar energy during the sunny months and “withdrawing” it during the cloudy ones — all tracked on your electricity bill.

This system ensures you’re always getting the most out of your solar investment, even when production isn’t at its peak.

What Happens When You Overproduce?

If your solar panels generate more electricity than your home uses over the course of a year, your credits can carry over for up to 12 months from when they were earned.

Important note:Ontario’s net metering program is a credit-only system — you do not receive cash payouts for excess production. Instead, credits are applied to future electricity bills.

That means:

You can offset your entire electricity usage.
You can’t use credits to earn money.
Credits that go unused after 12 months will expire.

To avoid wasting credits, most solar systems are sized to match your home’s annual consumption — not to dramatically exceed it.

How Net Metering Shows on Your Bill

Your electricity bill will clearly show:

Electricity consumed from the grid
Electricity exported to the grid
Net electricity used (consumption minus credits)
Credits carried forward

Example:

Solar sends 800 kWh to the grid in July
You only used 400 kWh from the grid that month
Your bill reflects 400 kWh of credit, which rolls over

Each utility presents this slightly differently, but all provide a transparent breakdown of how your solar energy affects your charges.

With a properly sized system and net metering, many Ontario homeowners see monthly electricity bills close to $0 from April to October — and significantly reduced bills in the winter.

Common Misconceptions About Net Metering

There’s a lot of misinformation floating around. Let’s clear a few things up:

1. “I get paid in cash for extra solar.”False — you earn credits, not money.

2. “Net metering stops working in the winter.”False — winter months are when you use the credits you banked during summer.

3. “The utility gets my power for free.”False — every kilowatt-hour you send to the grid is fully credited to your account.

4. “If I’m not home during the day, solar isn’t worth it.”False — net metering stores your solar energy as credits, so it doesn’t matter when you use power.

Final Thoughts

Net metering is one of the biggest advantages of going solar in Ontario. It allows homeowners to:

Offset their full annual electricity use
Lower or eliminate hydro bills
Take advantage of seasonal production
Get the most out of every panel installed

With rising hydro costs and strong government incentives, solar paired with net metering makes more sense in 2025 than ever before.

Want to See How Net Metering Would Work for Your Home?

At Solar Canada, we’ll design a custom solar system based on your actual usage and show you how net metering can lower your bills year-round.

Book your free quote today and take the first step toward energy independence.