How to Read a Utility Bill for Solar Sizing

Last updated: November 2026

A utility bill contains several different measurements, and each answers a different solar design question. Kilowatt-hours describe energy use; demand in kilowatts describes power over a defined interval; the tariff tells you what imports and exports are worth. Confusing them can produce a plausible system size with an unrealistic savings estimate.

This guide follows the bill from account details through annual consumption, rate schedules, future loads and post-solar reconciliation. Use the worked examples to check your calculations, then replace every assumption with the customer’s records and the applicable tariff. The extraction worksheet near the end keeps those inputs together.

SurgePV publishes this post and sells solar design software.

Why Your Utility Bill Is the First Document for Solar Sizing

The bill is a starting record of billed energy and charges, not a complete site survey or load profile. Before solar is installed, a full year of actual meter readings can provide a useful consumption baseline. After solar, grid imports alone no longer describe total building consumption.

Two customers with the same annual kWh can have different savings because their loads occur at different times or their tariffs credit exports differently. Fixed charges, demand charges and export rules must be separated before estimating avoided purchases. A monthly payment amount can also contain arrears or budget-billing adjustments unrelated to that month’s electricity use.

The Australian Government solar-sizing guide identifies electricity use, timing, prices, feed-in tariffs and available roof area as separate sizing inputs. Those distinctions apply to the worksheet here, although local connection rules differ.

Use the bill to establish the account and historical load, the tariff to establish billing treatment, and a site model to estimate production. Keep a record of the source and date for each. SurgePV supports energy-yield and financial modeling; this guide does not assume automatic bill-image extraction or a live tariff lookup.

Anatomy of a US Electric Bill: The Six Sections

Use these six categories to organize the information you find. Utilities combine or rename sections, and some details require a tariff, portal export or service record rather than appearing on the bill itself.

Section 1: Service Account and Meter Information

This section lists the service address, account number, meter number, and the billing period (start and end dates). The billing period length matters because months are not all 30 days. For an illustrative constant daily load, a 32-day bill contains 32 ÷ 30 − 1 = 6.7% more kWh than a 30-day bill. Normalize by days before comparing periods; do not treat a long billing month as a typical calendar month.

Record the meter identifier and whether readings are actual or estimated. If voltage, phase or service capacity is absent, obtain it from the service documentation and site inspection. Reconcile estimated periods with later actual readings or interval records; simply deleting a month can leave seasonal gaps.

Section 2: Rate Schedule Code

The rate schedule code may appear near the account details or itemized charges. Copy it exactly, including any rider or solar program, then obtain the tariff version relevant to the bill and proposed installation.

Sources checked November 2026: PG&E E-1 tiered-plan explanation, APS residential demand-plan explanation and the CPUC net metering and net billing comparison. These are examples of how to identify a schedule, not a complete list of available plans.

A tariff code is more reliable than a remembered plan name. Save the schedule and any riders with the proposal so another person can reproduce the calculation. A bill summary may omit seasonal windows, minimum charges or restrictions that affect future savings.

Section 3: Usage Summary

The total kWh consumed during the billing period, often shown as a single line under Usage This Period. On smart-metered accounts, the same section may also show daily average kWh, comparison to last year, and a 12-month chart.

For TOU plans, this section is split by Peak, Off-Peak, and Partial Peak (or Mid-Peak) kWh. Capture each separately. The Peak split is what drives evening exposure and battery economics.

For tiered plans, capture consumption and prices in each displayed tier. Do not assume every utility has the same number of tiers. The bill reduction depends on which billed units disappear when imports fall, so calculate the before-and-after tier totals.

For demand plans, record billed demand in kW along with the measurement interval, time window and any minimum or ratchet provisions. The plan determines the interval; the APS example above uses an hour.

Section 4: Detail of Current Charges

The itemized breakdown that turns kWh into dollars. The standard categories:

• Supply or generation charges: The cost of producing the electricity. Often charged per kWh. Avoided imports may reduce these charges, subject to the tariff.
• Delivery or transmission and distribution charges: The cost of moving power across power lines, substations, and the distribution grid. Usually variable per kWh, sometimes partially fixed.
• Customer charge or basic service charge: Fixed monthly fee for billing, metering, and account maintenance. Not removable by solar.
• Minimum bill or minimum delivery charge: The lowest amount you can be billed regardless of usage. Common in net metering markets.
• Demand charge: Per-kW fee on peak demand. Standard on commercial bills, present on a few residential rate plans.
• Franchise fees, public benefits, energy efficiency surcharges: Variable per kWh, sometimes flat. Mixed treatment under solar.
• State, county, and local taxes: Read the applicable calculation basis; tax treatment is not uniform across jurisdictions.

This section is where the effective rate hides. Dividing variable charges by billed kWh gives a historical average, not necessarily the marginal value of solar. Recalculate the tariff with reduced imports and separate exports to estimate savings. Tier thresholds, time windows and non-bypassable charges can change the result.

Section 5: Net Metering or Solar Summary (Post-Install)

Once a solar system is operating, the bill shows additional line items:

• Imports or kWh delivered to you: Energy pulled from the grid (typically at night and early morning).
• Exports or kWh received from you: Energy sent to the grid when solar production exceeds home demand.
• Net usage: Imports minus exports for the billing period.
• Credit balance or carry-forward: Running balance of credits in kWh or dollars rolling into the next period.
• True-up statement: Annual reconciliation, common in California, that settles credits and charges once per year.

Different utilities use different labels for the same line items. Forward kWh and Reverse kWh appear on dual-register meters. Some bills list Energy Export Credits or Net Energy Metering Credits as separate dollar amounts.

Section 6: Account History and Payment

An account-history chart may show previous consumption or billed amounts. Check its units and coverage before using it. A dollar chart is not a kWh history, and a budget-payment amount is not the cost of that period’s actual use. Request the underlying records when the chart is incomplete.

Rate Schedules Decoded: Fixed, Tiered, TOU, and Demand

The rate schedule is the single most important field on the bill for solar economics. Two customers with identical kWh consumption can have wildly different solar payback depending on which schedule they sit under. This section walks through the four common structures.

Flat Rate (Fixed Rate)

A flat energy rate charges the same price per kWh across the relevant time periods. It can still change with tariff revisions, and fixed account charges remain separate. Do not confuse a flat energy rate with a fixed monthly payment plan, which may merely spread estimated annual costs over the year.

A flat import price does not guarantee retail-rate export credits. If the customer receives a different export price, timing and self-consumption still matter. Read the import schedule and export agreement together before treating every generated kWh as equally valuable.

Where equal-value netting applies, annual energy can provide a useful first calculation, but settlement periods and remaining charges still matter. Panel orientation changes energy yield; storage adds losses and costs as well as potential bill or backup benefits. Evaluate these choices using the applicable rules instead of assuming a battery always helps or never helps.

Tiered Rate

A tiered plan changes the energy price as billed use crosses defined thresholds. The PG&E E-1 tiered-plan explanation describes two tiers: energy within the baseline allowance and energy above it. The allowance depends on factors including location, heating source and season; use the account’s actual allowance.

Reducing imports on a rising-block tariff removes the highest-priced remaining units first. The original bill’s blended price therefore need not equal the savings per avoided kWh. A correct estimate calculates the bill once before solar and again after the modeled import reduction.

For an illustrative two-tier month, assume the first 500 kWh costs USD 0.20/kWh and further use costs USD 0.30/kWh. At 800 kWh, energy charges are USD 100 + USD 90 = USD 190. If eligible billed imports fall to 600 kWh, charges become USD 130, saving USD 60 for 200 avoided kWh. These invented rates demonstrate arithmetic, not a utility offer.

The historical average in that example is USD 190 ÷ 800 = USD 0.2375/kWh, while the avoided units save USD 0.30/kWh. As imports fall further, savings may cross into the lower tier. Fixed fees and export credits need their own calculations.

Time-of-Use (TOU)

Time-of-use pricing changes the import energy rate by tariff-defined periods. Copy the exact seasonal calendar, weekday and holiday treatment, and clock convention. Avoid assigning a generic evening peak window to every customer.

This is a teaching schedule, not a California tariff. Each hour belongs to one period. An export price is deliberately absent because the export agreement must supply it separately; an off-peak import price is not automatically an export credit.

The CPUC net metering and net billing comparison distinguishes the retail-rate basis of legacy NEM export credits from the avoided-cost basis used for NBT. This is a jurisdiction-specific example of why import prices and export compensation must be modeled separately.

Three practical implications follow:

• Capture every billed TOU period rather than only the annual total. Check that period totals reconcile to the bill.
• Compare production with consumption at matching timestamps. Monthly peak kWh alone cannot tell you which intervals solar will cover.
• Compare candidate orientations and storage dispatch using the same weather and load inputs. Do not attach a universal percentage gain to west-facing panels or batteries.

A south-facing array might produce more annual energy at a particular site, while another orientation might better overlap valuable consumption. The result depends on location, shading and rates. The interval-data sizing workflow explains why load timing is needed before making that choice.

Demand Charge

A demand charge bills power in kW under a tariff-defined rule, separately from energy in kWh. The rule can involve a measurement interval, specific hours, a prior-period ratchet or a minimum. The APS residential demand-plan explanation uses the highest on-peak hour; a universal 15-minute definition would be wrong.

Illustrative commercial example: assume USD 0.08/kWh energy and USD 18/kW demand. With 5,000 kWh and 25 kW of billed demand, energy costs USD 400 and demand costs USD 450 before other charges. These assumptions explain the calculation rather than quote a real tariff.

Solar reduces billed demand only if it lowers the demand value selected by that rule. A short cloudy interval or a different operating day can set the monthly maximum even when annual solar production is substantial. Storage or load scheduling may help, but the model needs their actual power, energy and operating constraints.

For demand analysis, obtain interval data and reproduce the existing demand charge first. Then apply solar and any storage dispatch and recalculate the billing rule. Do not estimate demand savings by multiplying annual energy savings by the demand-charge total.

Side-by-Side Comparison

The rate structure determines which information a savings model needs. The verified utility examples above show why no single bill-average price works for all four structures.

A plan can combine these features. A TOU account may also have demand charges, while a flat energy rate may sit alongside a fixed service fee and a separate export contract. Keep the components separate in the worksheet.

Step-by-Step: Extracting Sizing Data From Your Bill

This is the procedural core of the guide. The seven steps work for any US bill and translate directly into the inputs needed for system size.

Step 1: Pull 12 Consecutive Months of Bills

A single month is not a sizing input. Heating-dominant homes use more in winter than summer. Cooling-dominant homes flip the pattern. Pulling 12 months captures both peaks.

Where to get them:

• Customer portal: Download statements and, where available, meter data. Record whether the export contains energy or average power.
• Utility request: Ask for the required date range and meter identifiers. Check for missing periods and account changes.
• Authorized data service: Use customer-approved access and check what the service actually supplies. A bill total and an interval export are different inputs.
• Existing records: Reconcile the customer’s PDFs with the portal totals rather than entering both as separate months.

Identify estimated readings, corrections and catch-up bills. An estimate followed by an actual reading may reconcile across several periods, but the individual monthly shape can remain uncertain. Ask for corrected records where available and document any allocation assumption. Do not quietly substitute a convenient month for a missing season.

A changed occupant or newly occupied building also needs context. Historical consumption may belong to a different operating pattern. Keep observed use, engineering estimates and planned additions in separate columns so the design can be revised when better data arrives.

Step 2: Locate the Rate Schedule Code

Copy the account’s rate code, solar tariff and riders rather than selecting a familiar plan from memory. The verified PG&E E-1 and APS examples earlier show how apparently simple residential plans can have different structures.

Save the published tariff with its effective date. Check whether it applies to the historical bills, the proposed solar installation, or both. A proposed system may trigger a different eligible rate, and an old bill may predate a price revision.

If the plan is unclear, ask the utility to identify the account’s enrolled schedule. The proposal should say which plan it assumes after installation and which eligibility conditions remain unresolved. Separate this from predicting future rate increases; a pricing assumption is not an approved tariff.

Step 3: Extract Total kWh Per Month

For each of the 12 bills, record the total kWh shown in Section 3 (Usage Summary). Sum for annual consumption.

For TOU plans, capture three numbers per month: Peak kWh, Off-Peak kWh, Partial Peak kWh (if applicable). The peak share is what battery storage most directly attacks.

For tiered plans, capture kWh consumed in each tier. Tier-level detail lets you recalculate the bill after reducing imports; the historical average need not equal the marginal savings rate.

Illustrative data template, not a measured household or market benchmark:

This is the working data sheet. From here every downstream calculation flows.

Step 4: Separate Variable Charges From Fixed Charges

In Section 4 of each bill (Detail of Current Charges), classify each line:

Energy-related charges to examine:

• Supply or generation charges per kWh.
• Per-kWh delivery components.
• Per-kWh surcharges, with their offset and credit rules.
• Taxes, using their actual basis rather than assuming they all disappear.

Charges that need separate treatment:

• Fixed customer and meter charges.
• Minimum-bill rules, which may act as a floor rather than a fee added on top.
• Demand charges and any historical ratchet.
• Non-bypassable components on imports.
• Credits, arrears, deposits or payment-plan adjustments unrelated to the modeled energy period.

Create a column for the tariff reference explaining each classification. A variable charge can still have special netting rules, and a minimum bill should not be counted twice. Do not label the full delivery line fixed or avoidable until you have inspected its components.

Use the customer’s applicable charge rather than a national monthly-fee range. Discount programs, service classes and tariff revisions can change fixed charges. If an item cannot be classified, leave its savings contribution unresolved instead of assuming full elimination.

Step 5: Calculate the Effective Energy Rate

Dividing historical energy-related charges by consumption gives a useful average for checking the data. It is a screening figure, not a promise that each generated kWh saves that amount.

Illustrative annual charges for the 11,300 kWh example:

• Generation: USD 1,580.
• Delivery: USD 1,820.
• Variable taxes and surcharges: USD 290.
• Total: USD 3,690.

Historical average = USD 3,690 ÷ 11,300 kWh = approximately USD 0.327/kWh. This is an invented teaching bill, not a Northern California tariff or a verified customer account.

Before estimating solar savings, classify those charges under the real tariff. Then calculate a baseline bill and a post-solar bill using the same load and rate assumptions. The difference, plus applicable export credits, is the modeled reduction. If those credits are already in the post-solar bill, do not add them a second time.

For TOU rates, preserve each period’s prices and consumption. For tiers, preserve thresholds. For demand, preserve the billing rule and interval data. Use the historical average to spot input errors, such as mixing cents with dollars, rather than replacing all of that information with one price.

Step 6: Adjust for Future Load Changes

Keep planned additions separate from the historical baseline. Ask what equipment is being installed, when it will operate, and what existing consumption it replaces. An electric heat pump replacing gas adds electrical load; replacing resistance heating may reduce it.

Build an estimate from documented inputs:

• Electric vehicle: Annual travel divided by efficiency, with charging losses added when the efficiency figure excludes them. In an illustrative case, 12,000 miles ÷ 3.5 miles/kWh is about 3,429 kWh before additional charging losses.
• Space heating: Use a building heat-demand estimate and equipment performance for the local climate. Account for any electrical heating already in the bills.
• Water heating: Use the selected equipment’s energy information and expected hot-water use. Occupancy can matter as much as tank size.
• Pool or spa: Use operating schedules and equipment input power, including seasonal heating if planned.
• Home addition: Describe occupancy and equipment assumptions rather than assigning a fixed annual kWh allowance per room.
• Fleet charging: Model vehicle duty cycles, charging location and simultaneous demand as well as total energy.

For each addition, record evidence, confidence and installation timing. A customer’s tentative future purchase should not silently become a guaranteed load in the base case. Provide a separate scenario and identify any network documentation needed for a larger system.

Check the applicable interconnection rules and export limit. There is no universal US allowance of 100–120% of historical consumption. An energy-based eligibility limit, an inverter connection limit and an export-power limit are different constraints. The customer’s plans must satisfy the actual rule, not a percentage copied from another utility.

Step 7: Run the System Size Formula

Use annual consumption to set an energy target, then divide by a site-specific modeled annual yield per kW DC. This separates the measured load from the production assumptions:

Initial PV capacity (kW DC) = Target annual production (kWh/year) ÷ Specific yield (kWh/year per kW DC)

A production tool such as the NLR PVWatts calculator estimates generation from inputs including location, system size, array type, losses, tilt, azimuth and inverter assumptions. Its published cautions explain that estimates have uncertainty and only reflect site characteristics represented in the inputs. Record those inputs and the model version with the result.

For an illustrative 100% annual-energy target of 11,300 kWh, compare two assumed yields. These are teaching assumptions, not measured Phoenix or Boston values and not outputs from a documented simulation.

At the lower assumed yield, the capacity required is one-third greater before rounding. The calculation is an initial energy match, not a finished design: module counts, roof area, electrical limits, network approval and economics can all change the selected capacity.

The alternative peak-sun-hours formula is useful only when its loss treatment is explicit. Peak sun hours express irradiation as equivalent hours at a reference irradiance, not the number of daylight hours. A blanket 0.8 factor cannot represent every roof’s temperature, shading, clipping and electrical losses. Do not apply a second blanket loss factor to a yield output that already includes those losses.

For a multi-orientation roof, simulate the actual array segments. Increasing DC size while holding the inverter constant may change clipping, so specific yield is not necessarily constant across every candidate design. Re-run the final module and inverter configuration instead of treating the first division as an approval-ready result.

SurgePV supports energy-yield modeling, financial modeling and proposal generation. Your team still needs to supply and check the consumption, tariff and project assumptions used in the proposal. Automated extraction from any bill image and universal tariff validation are not capabilities claimed in this guide.

Reading Commercial Bills: Demand Charges and Time-of-Use

Commercial bills can include several demand components, energy periods and service charges. Annual energy alone cannot describe these accounts. Identify each meter and tariff, then collect the interval data needed to reproduce billed demand before estimating what solar changes.

What a Commercial Demand Charge Looks Like

Illustrative line items, using assumed rates rather than a utility quotation:

• Energy charge: 32,400 kWh × 0.082 USD = 2,656.80 USD
• Demand charge (on-peak): 85 kW × 18.50 USD = 1,572.50 USD
• Demand charge (off-peak): 92 kW × 6.20 USD = 570.40 USD
• Facilities charge: 240.00 USD
• Total: 5,039.70 USD

Energy is 53 percent of the bill, demand is 42 percent, and fixed charges are 5 percent. A solar system that reduces kWh by 50 percent reduces only the energy component. If solar production does not overlap with the customer’s peak demand intervals, demand charges remain almost unchanged.

When Solar Reduces Demand Charges

Solar reduces a demand charge when it lowers the billed demand selected by the tariff. A daytime peak may offer an opportunity, but a sunny-day maximum reduction is not the same as a reduction in the month’s billing peak.

Obtain the full interval series, identify missing readings and align time zones with the generation model. Apply the tariff’s measurement window, season and ratchet rules. Recalculate the peak after solar and inspect the intervals that now set it; the maximum can move to a different day or hour.

For storage, check both inverter power and usable energy. A battery that can cover a brief peak may not cover a long operating shift, and it must have adequate charge when needed. Load scheduling can also change demand, but include the customer’s operating constraints rather than assuming equipment can always be moved to another hour.

Time-of-Use on Commercial Bills

Commercial TOU rates may combine energy periods with separate demand windows. Copy the actual schedule, including any seasonal changes and holidays. Do not reuse a historical tariff’s clock times just because its code looks familiar.

Compare candidate layouts against the same interval load and tariff. A later-producing orientation may be useful where it overlaps valuable imports, but the result depends on site shading, weather and the account’s prices. Include annual production and bill reduction together so the customer can understand any trade-off.

Show which savings depend on a change in operations or rate enrollment. A model built on a different schedule from the one the customer can actually choose is not a reliable quote. Save the eligibility evidence with the financial assumptions.

Service Voltage and Interconnection Limits

A bill may identify service class or voltage, but it is not a complete electrical service record. Obtain phase, equipment ratings and connection details from utility documentation and site verification before selecting equipment.

The network’s connection process can affect the design at any size. Ask about inverter capacity, export limits, protection requirements and possible infrastructure upgrades. Do not use a universal 500 kW threshold to decide when interconnection needs attention.

Keep annual energy limits separate from instantaneous export power. A large load can support a substantial annual production target while the connection still limits exported kW. The final proposal should identify which constraints are verified and which depend on utility review.

After Solar: How the Bill Changes

Once the system is operating and net metering or net billing is in effect, the bill changes shape. Understanding the new format matters for two reasons: customers will call asking why they still have a bill, and installers need to verify the savings match the proposal.

New Line Items

After installation, distinguish grid exchange from building load. Energy consumed directly from PV never crosses the utility import meter, so the import line alone understates total consumption.

• Imports: Energy delivered from the grid during the billing period.
• Exports: Energy delivered to the grid, subject to the tariff’s credit rules.
• Net energy: Imports less exports where the utility displays this summary; its financial meaning depends on the settlement rules.
• Credits: Dollar or energy balances, with expiry and carry-forward rules to check.
• Reconciliation: A settlement or true-up statement where the program provides one.

For a system without storage, a useful energy balance is building load = grid imports + PV generation − grid exports, using aligned meter periods and consistent measurement points. Storage complicates that balance because charging, discharge and losses must also be accounted for. Do not combine an inverter calendar-month total with a different utility billing period without adjustment.

Net Metering vs. Net Billing

Net metering and net billing use different credit mechanisms, and local program details matter. The CPUC net metering and net billing comparison distinguishes legacy NEM export credits based on import rates from NBT credits based on avoided-cost values, usually lower than import rates. Non-bypassable charges and settlement rules still need separate treatment.

This distinction prevents a common modeling error: multiplying every generated kWh by the retail import price. Direct self-consumption and grid exports may have different values. Even equal annual production and consumption can leave a bill because the account imports and exports at different times and retains other charges.

Avoid predicting a fixed remaining bill for every system of a particular kW size. Use the actual load timing, production, tariff and credit agreement. The same nameplate capacity can produce different energy and financial results on different roofs.

True-Up: Annual Reconciliation

A true-up settles balances under the applicable program; it is not a universal promise that all charges disappear or all credits become cash. Check what rolls over, what is paid monthly and what happens at settlement.

For the large California utilities, the CPUC comparison distinguishes annual billing and true-up under legacy NEM from monthly billing with annual credit reconciliation under NBT. Other programs can work differently. Explain the account’s arrangement before the customer interprets a credit balance as spendable cash.

At handoff, identify the statement fields used to compare actual performance with the proposal. Review the billing period, weather, actual consumption and tariff changes before diagnosing a discrepancy. A payment-plan adjustment or prior balance should not be mistaken for a solar performance problem.

Common “Why Do I Still Have a Bill?” Scenarios

1. Fixed customer charge: The account’s applicable fee remains unless the tariff says otherwise.
2. Minimum bill or minimum delivery charge: Some utilities enforce a minimum monthly amount even for net-zero customers.
3. Time-of-use mismatch: Solar production at off-peak prices, evening imports at peak prices.
4. Net billing discount: Exports earn less than imports cost.
5. Demand charges: Persist even with high solar offset on commercial accounts.
6. System underperformance: Soiling, shading, or inverter issues reducing actual production below proposal.
7. Increased consumption: New EV, heat pump, or occupancy change since the proposal.

Walk through these items at handoff so the customer knows which statements to save and what information a later savings check will need.

Common Bill-Reading Mistakes That Distort System Size

The following checks catch different errors in the consumption baseline, production estimate and bill model. Their impact depends on the account; there is no verified universal percentage error for each mistake.

Mistake 1: Sizing on One Month of Data

A single August bill captures peak air conditioning. A single January bill captures peak heating. Neither represents the annual average. Always use 12 consecutive months. If only one bill is available, the customer needs to request a full year before the proposal closes.

Mistake 2: Using the Marketing Rate Instead of the Effective Rate

The headline kWh price advertised by the utility is rarely the rate solar actually offsets. The effective rate is the sum of variable charges divided by total kWh. That historical average is only a check. Calculate savings from the charges actually avoided after applying timing, tiers and export rules; the marginal rate can be higher or lower than the average.

Mistake 3: Treating Fixed Charges as Offsettable

Customer charges, meter charges, and minimum bills do not go away with solar. Proposals that promise a zero bill in the marketing copy but ignore fixed charges generate complaints. State the fixed component clearly in the savings projection.

Mistake 4: Ignoring the Rate Schedule Code

Two homes with identical annual consumption can have radically different solar economics if one is on a flat rate and the other is on a TOU plan with low export compensation. Pulling the rate schedule code and looking up the official tariff is non-negotiable.

Mistake 5: Skipping the Estimated Read Check

A month flagged as Estimated is the utility’s projection, not actual meter data. Reconcile estimates with subsequent actual readings or interval data. Record any remaining uncertainty in monthly allocation instead of inventing a correction percentage.

Mistake 6: Forgetting Future Loads

EVs, heat pumps, pool heaters, and home additions are common additions during the system’s operating life. An increase in consumption lowers the annual offset percentage if production stays unchanged; efficiency improvements can move it in the other direction. Plan ahead by asking about expected additions and adjusting the baseline.

Mistake 7: Confusing Demand kW With Average kW

Billed demand follows the tariff’s defined interval and window, not the annual average load. In an illustrative profile, an annual average of 1.5 kW can coexist with a 4.5 kW billing peak. Commercial customers especially need to understand this difference because demand charges scale with peak, not average.

Mistake 8: Annualizing From a Single Quarter

Quarterly bills cover roughly three months; record the actual start and end dates. Multiplying by 4 to get annual usage ignores seasonal variation. Use a complete year of records and check for gaps, overlaps and a leap day when relevant.

Mistake 9: Missing Net Metering Banked Credits

For existing solar customers being resized, the bill shows the current banked credits. Adding a battery or expanding the array changes the credit accumulation pattern. Ignoring the existing balance leads to incorrect future bill projections.

Mistake 10: Using a Generic Derate Factor

The loss assumptions depend on the site and modeled equipment. Shading, temperature, soiling, wiring and clipping should not be hidden inside an unexplained universal multiplier. Review which losses the yield model already includes to avoid counting them twice.

Keep the loss assumptions and model output with the proposal. If the site information is incomplete, show a sensitivity case and identify what survey evidence will resolve it. A more precise-looking decimal does not compensate for an unmeasured obstruction or an incorrect roof orientation.

Bill-to-Solar Extraction Worksheet

Use this suggested worksheet to capture bill inputs and their evidence. It is an editorial template, not a claim about a required SurgePV form. Fill it for each account, and retain source files so another person can reproduce the calculation.

Customer & Service

Rate Schedule

12-Month Usage

Charges Breakdown

Future Load Planning

Sizing Calculation

Keep this intake document alongside the roof layout, production model and equipment choices. Record who checked the bill entries and which tariff version supports the financial assumptions. If any input changes, update the affected model rather than editing only the final savings figure.

Country and Utility Variations Worth Knowing

The framework above is built on US bill conventions, but solar professionals in other markets apply the same logic against different label conventions.

United Kingdom

Separate the electricity unit rate from the standing charge and inspect any day/night or other time-based rates. Ofgem’s bill explanation describes the unit-rate and standing-charge distinction. A reduced import volume does not by itself remove the standing charge.

For exports, obtain the customer’s actual agreement. Ofgem’s Smart Export Guarantee page describes payments for eligible exported low-carbon electricity. Do not substitute a generic pence-per-kWh range for the selected supplier’s terms, or assume that import and export prices match.

Germany

Identify Grundpreis, the fixed component, and Arbeitspreis, the consumption-related price. Bundesnetzagentur’s price explanation describes how these components form the bill. Keep the payment installment separate from the final annual consumption settlement.

For solar sizing, compare the actual import price with the applicable export arrangement and use the customer’s load profile. Do not assume self-consumption or maximum export is always the best objective. A system expansion, changed supplier or new load may require a fresh calculation using the relevant contract terms.

Australia

Check average daily use, seasonal totals, import prices and the feed-in tariff. The government sizing guide cited earlier recommends obtaining interval data where available and distinguishes network connection limits from export limits. Those limits may affect the final configuration even when the roof has space for more modules.

Keep installation incentives separate from electricity-bill savings. An upfront financial benefit and an export payment are different cash flows, with different evidence and eligibility. Read the retailer agreement and distributor requirements for the actual property instead of carrying assumptions between states or accounts.

Spain

Obtain the supply contract and export-compensation agreement alongside the bill. Identify consumption-related charges, contracted-capacity charges and any surplus-energy credit separately. A capacity charge is not automatically the same calculation as a US metered-demand charge.

For each credit, check the settlement period, applicable limit and treatment of unused balances in the actual agreement. This guide does not quote a Spanish compensation cap or claim a universal net-metering arrangement. Keep unresolved contract terms out of guaranteed savings until the supplier documents them.

Italy

ARERA’s electricity-bill guide separates consumption charges from fixed and contracted-power components. It also identifies recalculations and other credits or debts. These adjustments can explain why the amount due differs from consumption multiplied by a simple rate.

Capture the account’s actual time bands and import contract, then obtain the applicable export arrangement separately. Do not infer eligibility for a particular compensation program from the meter’s time-band labels or a remembered phase-out date. Use the documents governing the installation and keep their effective dates with the proposal.

Across markets, the labels differ but the task remains the same: identify energy, power, fixed charges and credits before translating a bill into a solar model. Do not import one country’s offset or settlement rules into another country’s quote.

Put the Bill Worksheet to Work

Start with a complete consumption record, preserve the tariff details and document planned load changes. Then compare candidate production profiles and calculate the remaining bill under the applicable agreement. State which inputs are measured, modeled or still awaiting verification.

Use SurgePV’s generation and financial modeling workflow to explore the design with those reviewed inputs. Keep the original worksheet beside the proposal so the customer can see how consumption, layout and billing assumptions lead to the estimate.

Frequently Asked Questions

How do I read a utility bill for solar sizing?

Start with a complete year of consumption records and the applicable tariff. Record kWh, billing dates, rate code, fixed charges and any time-of-use or demand components. Use a site-specific production estimate to translate the energy target into an initial PV capacity.

What is a rate schedule on an electric bill?

A rate schedule identifies the rules used to price the account. It can specify energy prices, time windows, tiers, fixed fees and demand charges. Save the effective tariff and solar agreement rather than relying only on the summary printed on one bill.

What kWh number should I use to size a solar system?

Use a complete annual consumption baseline adjusted for documented changes. If solar already operates, grid imports alone are not total building use. Reconcile billing periods and estimated readings, and identify missing data before presenting a firm estimate.

Does time-of-use pricing change solar sizing?

Time-of-use pricing changes the value of generation according to when it reduces imports or earns export credits. Model load and production at matching intervals with the actual tariff. Equal annual production and consumption do not guarantee equal financial value.

What charges remain on an electric bill after solar?

Fixed charges and other tariff-defined charges can remain after installation. Demand charges depend on whether solar or storage reduces the billed demand, and export credits may not offset every component. Calculate the post-solar bill rather than promising a zero balance.

What is a demand charge on a solar customer’s bill?

A demand charge bills a power value in kW under a defined tariff rule. The measurement interval and time window vary, so do not assume every plan uses 15 minutes. Estimate savings by recalculating billed demand after applying solar and any storage dispatch.

Should I size solar to 100 percent of annual usage?

A 100 percent annual-energy target is a design scenario, not a universal optimum or approval limit. Compare roof space, load timing, export value and network requirements. Planned additions should be documented separately from historical use.