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True-up policy
Community & shared solar
Community solar annual true-up estimator
See what happens to a leftover credit balance at year end under your utility's true-up policy, whether it's forfeited, paid out, or carried forward.
How it works
Two steps to your true-up estimate
Step 1
Confirm whether your program even has a true-up
Many programs don't, letting credit roll forward indefinitely instead. Check the credit rollover calculator to see your balance trajectory if your program has no true-up at all.
Step 2
Get the exact policy and payout rate if one exists
Your provider or utility tariff documentation should state whether surplus is forfeited, paid out, and at what rate. Don't assume a payout rate without confirming it, since avoided-cost rates vary widely, similarly to how the credit allocation estimator requires actual figures rather than estimates for accuracy.
Understanding the annual true-up
Why some programs settle annually instead of rolling forward forever
An annual true-up gives the utility a defined point to reconcile accounts rather than letting balances accumulate indefinitely, which can simplify their accounting and billing systems. Not every program has this feature, so it's worth confirming rather than assuming your credit either always rolls forward or always resets, and the credit rollover calculator can help you visualize the difference. For the official wording, see the Department of Energy's community solar basics guide.
Why a payout rate is usually much lower than your credit rate
When a program does pay out surplus credit, it's typically at an avoided-cost rate, reflecting what it would have cost the utility to generate that power itself, rather than the retail rate you receive as an ongoing bill credit. This means a payout is worth meaningfully less per kWh than the same credit applied directly to your bill would have been. The avoided cost rate calculator covers this same rate mechanic in more detail.
How this affects subscription sizing decisions
If your program has a use-it-or-lose-it true-up, consistently generating a large surplus effectively wastes some of your subscription's value each year. Check the subscription size calculator to see whether a smaller offset percentage would better match your actual usage and reduce the surplus at risk. A similarly-sized rooftop system faces the same over-generation question, covered by the negative bill credit rollover calculator. The Department of Energy's community solar basics guide covers the general credit mechanism this sizing decision is built around.
What to do before your first true-up date
Find out when your program's true-up date falls and check your balance shortly before it, since this gives you a chance to understand what to expect rather than being surprised by the settlement. The credit expiration calculator covers a related but distinct mechanic worth checking too, since some programs combine a rolling expiration window with an annual true-up. Check the DSIRE database for your state's specific true-up and settlement rules, since these details are often set at the state or utility level.
Questions
Frequently asked
An annual true-up is a once-a-year settlement where the utility reconciles your credit balance instead of letting it roll forward indefinitely. Depending on the policy, any leftover surplus at that point might be forfeited, paid out at a reduced rate, or simply carried into the new year.
Utilities often pay out true-up surplus at an avoided-cost rate, which reflects roughly what the utility would have paid to generate that power itself, rather than the higher retail rate you receive as an ongoing bill credit. This is typically much lower, so a payout is worth meaningfully less than the same credit applied to a bill.
This varies significantly by state and utility. Some programs have no true-up at all and let credit roll forward indefinitely, while others reset annually, so it's important to check your specific program's rules rather than assume.
Choosing a subscription size closer to your actual usage, rather than oversized, reduces how much surplus accumulates in the first place. If your program has a use-it-or-lose-it true-up and you're consistently building a large surplus, a smaller subscription percentage may be worth considering.