Why Exported Solar Power Keeps Getting Cheaper

Utilities are not paying less for exported solar because they are irrational. They are paying less because daytime surplus power is often not what the grid needs most.

Many people blame California utilities for cutting export compensation, but the grid’s logic is straightforward. Rooftop solar produces most of its energy during daytime hours, when system-wide demand is often lower.

Electricity is difficult to store at scale, so excess midday generation can actually create operational stress instead of value.

Then evening arrives, demand spikes, and solar households still rely on the grid. From the utility’s perspective, low-value daytime exports and high-value evening imports are not the same thing. Understanding that reality helps explain why batteries became so important.