Layton Smith Sr. is an IRS Enrolled Agent and general partner at HofflerSmith Financial in Cherry Hill, New Jersey, with 27 years of tax practice. He has overseen thousands of solar and clean energy tax credits, rebates, and their implications for his clients.
Montana still credits exported solar kilowatt-hour for kilowatt-hour at the full retail rate, which puts it in a shrinking group of states. It also empties your accumulated credit balance once a year and hands the remainder to the utility for nothing. What almost nobody realizes is that you choose when that happens, from four dates, and the choice is worth a whole winter of banked power.
Montana Still Nets at Full Retail
Under Title 69, chapter 8, part 6 of the Montana Code, the utility measures net electricity produced or consumed during each billing period, and where you generate more than you use, you are credited for the excess kilowatt-hours, with that credit appearing on the following month’s bill. Credits are held in kilowatt-hours rather than dollars, which is the version worth having: a unit banked in July buys a unit in January regardless of what happened to rates in between. Against a Montana residential rate near 13.2¢, that is full value on every exported unit, which is more than most states still offer.
For programs beyond Montana, our national solar incentives guide covers every state.
Residential systems up to 50 kW qualify, comfortably above any normal rooftop array. The Public Service Commission rejected NorthWestern Energy’s attempt to end retail netting and create a separate customer class for solar customers in December 2019, and no successor tariff has replaced it since.
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See which true-up date suits your usage
The One Date You Get to Choose
Here is the provision that decides how much of your generation you actually keep. The statute lets the customer-generator designate January 1, April 1, July 1 or October 1 as the beginning of a 12-month billing period. At the end of it, any remaining unused kilowatt-hour credit accumulated over those 12 months is granted to the utility, without any compensation to you.
In Montana, generation peaks in summer and consumption peaks in winter. So the question is simply which date leaves your balance closest to empty when the clock runs out.
Start date | Your year ends | What your balance looks like then |
|---|---|---|
April 1 | March 31 | Lowest. A summer of banking has just been spent across the winter. |
January 1 | December 31 | Partly drawn down, with the coldest months still ahead of it. |
July 1 | June 30 | Rising again after spring, so some of the new bank is surrendered. |
October 1 | September 30 | Highest. An entire summer surrendered on the eve of winter. |
April 1 and October 1 are the same statute, the same system and the same roof, separated by a choice made once on a form. Ask your installer which date they are putting down, and ask before the interconnection paperwork is filed rather than after.
This is also why sizing a Montana system to more than your annual consumption is money spent on power you will hand over for free. The credit bank has an annual ceiling built into it, and that ceiling is your own yearly usage.
The Property Tax Exemption Montana Still Has
Program | What it is worth | Status in 2026 |
|---|---|---|
Net metering | Full retail kWh credits, surrendered at your annual true-up date | Active; you choose the true-up date |
Property tax exemption | $20,000 of assessed value, 10 years | Active |
Montana state tax credit | $0 | Repealed by Senate Bill 399 (2021); not claimable for new installations |
Federal 25D credit | $0 | Ended for systems you buy and own whose installation is completed after December 31, 2025 |
Federal 48E credit | Reaches you only as lease or PPA pricing | Third-party owners only |
Montana’s $500 Alternative Energy System Credit, once claimed on Form ENRG-B, was repealed by Senate Bill 399 (2021) and cannot be claimed for a new installation. If a quote or an older guide still counts it, the math is a few years out of date.
Alongside it sits a property tax exemption that is easy to overlook. For a single-family home, $20,000 of the assessed value attributable to the renewable energy system is exempt from property tax for the ten years following installation. That is not cash in hand, but it removes the quiet penalty that improving a house usually carries.
The federal residential credit is $0 for purchased systems whose installation is completed after December 31, 2025 under Public Law 119-21, which leaves the property tax exemption as Montana’s one standing state benefit.
You Likely Will Not Qualify If
- Your power comes from a rural electric cooperative. Montana’s net metering statute governs the regulated utilities. Cooperatives set their own terms, and several are considerably less generous.
- You want a system above 50 kW. That is the statutory ceiling for net metering here.
- You are planning to bank credits for longer than a year. Everything unused at your designated annual true-up is granted to the utility without compensation.
- You are counting on the 30% federal credit. Section 25D is $0 for purchased systems whose installation is completed after December 31, 2025.
Building Around the True-Up Calendar
Montana gives a homeowner two levers that most states do not, and both are set before the panels are switched on. Size the array to annual consumption rather than above it, because anything above it is surrendered. Then pick the true-up date that puts the surrender at the moment your bank is naturally lowest, which in a state that heats in winter and generates in summer means the spring.
Get those two right and Montana’s retail netting is among the better arrangements left in the country. Get the date wrong and you can hand a summer of generation to the utility every year without ever seeing it on a bill. Our Montana cost guide covers pricing and the Montana installer list covers who does the work.
Montana Solar FAQs
Yes, and at full retail value. The utility measures net electricity produced or consumed each billing period, and excess generation is credited in kilowatt-hours on the following bill. Residential systems up to 50 kW qualify. The Public Service Commission rejected NorthWestern Energy’s attempt to end retail netting in December 2019 and no successor tariff has replaced it.
At your annual true-up, and you choose when that falls. The statute lets you designate January 1, April 1, July 1 or October 1 as the start of your 12-month billing period, and any unused kilowatt-hour credit at the end of it is granted to the utility without compensation. April 1 is usually best, because your year then ends on March 31 with the summer bank already spent across winter.
No, not anymore. The $500 Alternative Energy System Credit was repealed by Senate Bill 399 in 2021 and cannot be claimed for a new installation. What Montana still offers is the property tax exemption: $20,000 of the assessed value of a single-family home’s system is exempt for ten years.
No larger than your annual consumption. Because unused kilowatt-hour credits are surrendered at your annual true-up without payment, generation above what your house uses in a year is given to the utility for nothing. The credit bank effectively has a ceiling, and that ceiling is your own yearly usage.
No. The statute governs the regulated utilities, so rural electric cooperatives set their own interconnection and export terms and several are less generous than the state rule. If a cooperative bills you, ask for its net metering terms in writing rather than assuming the figures on this page apply to your address.
The true-up date is set before installation, not after. Enter your ZIP code to see what Montana installers are quoting.
Get the date set before installation
References & Research Sources
EcoGen America reviewed the Montana net metering statutes, Public Service Commission orders, Department of Revenue credit and exemption guidance, federal energy data, and IRS guidance for this page. Sources accessed between June 10 and August 20, 2026.
- Montana Legislature. Montana Code Annotated 69-8-603. Net electricity measured each billing period, excess kWh credited forward, the customer’s designation of the annual true-up date, and the uncompensated surrender of unused credits at the end of the 12-month period. Accessed August 20, 2026.
- Montana Legislature. Montana Code Annotated 69-8-103. The 50 kW system limit. Accessed August 20, 2026.
- Montana Public Service Commission. December 2019 order in the NorthWestern Energy rate case. Rejected the proposal to end retail net metering and create a separate solar customer class. Accessed August 20, 2026.
- Montana Department of Revenue. Alternative Energy System Credit, Form ENRG-B. Confirms the credit’s repeal under Senate Bill 399 (2021); it cannot be claimed for new installations. Accessed August 20, 2026.
- Montana Department of Revenue. Renewable energy property tax exemption. $20,000 of assessed value on a single-family dwelling exempt for ten years. Accessed August 20, 2026.
- U.S. Energy Information Administration (EIA). Electric Power Monthly. The Montana statewide average residential price. Accessed August 20, 2026.
- Internal Revenue Service (IRS). One, Big, Beautiful Bill Provisions. Guidance on the Public Law 119-21 termination of the Section 25D residential credit for systems whose installation is completed after December 31, 2025. Accessed August 20, 2026.
