Modesto is served by the Modesto Irrigation District (MID), a municipal utility that is exempt from California’s NEM 3.0 net billing. MID runs its own NEM 2.0 program and credits the excess power you export to the grid at 7.6 cents per kWh as a monthly bill credit. Central Valley sun means high production. The 30% federal 25D homeowner credit ended December 31, 2025.
If your power comes from the Modesto Irrigation District (MID), this is how rooftop solar pays you back in 2026. The single most important thing to know is that MID is a publicly owned municipal utility, an irrigation district, not an investor-owned utility, so it sets its own solar rules and sits outside California’s NEM 3.0 net billing tariff. That one fact makes solar in Modesto work differently from PG&E, SCE, and SDG&E territory. Add the Central Valley’s long, hot, sunny summers, which push rooftop production high, and Modesto is one of the more favorable places to go solar in the state. This page explains MID’s net metering, how it differs from the big investor-owned utilities, how to interconnect, and how to tell if your home is a good fit.
Modesto solar at a glance
MID runs its own crediting and interconnection process. Because it is a municipal utility, its net metering terms are set by the MID Board, not the California Public Utilities Commission, so the terms below come straight from MID.
| Detail | What to know in Modesto |
|---|---|
| Utility | Modesto Irrigation District (MID), a publicly owned municipal utility |
| NEM 3.0 status | Exempt. As a municipal utility, MID is outside the CPUC net billing tariff that governs PG&E, SCE, and SDG&E |
| Solar crediting program | MID net energy metering (NEM 2.0) |
| Export credit | 7.6 cents per kWh for excess generation, shown as a monthly credit on your bill |
| System size cap | Up to 115% of your annual demonstrated electricity use |
| Production | High. Central Valley sun gives Modesto roofs strong year-round output |
| Source | MID Solar Program |
What a typical Modesto system produces. According to MySolarFY’s own analysis (August 2026), a typical 7 kW rooftop system in Modesto (ZIP 95354) produces about 11,500 kWh a year (NREL PVWatts). That is strong output, thanks to the Central Valley’s high solar resource, and it covers a large share of a typical local home’s electricity use. For context, California’s statewide residential average price is about 33.25 cents per kWh (EIA, May 2026), but that figure is driven by the big investor-owned utilities. MID’s municipal rates run below the state average, which is a defining feature of going solar in Modesto, so confirm your current MID residential rate when you model savings. Your own number depends on your roof, shade, and usage, so treat this as a planning estimate and get a site-specific production figure from an installer.
Our estimate of where that value comes from. Because MID pays a flat 7.6 cents per kWh for exports but you avoid the full retail rate on the solar you use yourself, the split between what you use on-site and what you send back matters. Here is how MySolarFY breaks down a typical 7 kW Modesto system (August 2026), using a common daytime-heavy Central Valley usage pattern of roughly 60% self-consumed and 40% exported. Treat the assumptions as illustrative and confirm your own MID rate and usage split.
| Input (our assumptions) | Estimated annual value |
|---|---|
| Total production, 7 kW system (PVWatts, ZIP 95354) | About 11,500 kWh per year |
| Solar you use on-site (about 60%, avoids your full retail rate) | About 6,900 kWh × your MID retail rate (verify), the larger share of the savings |
| Solar you export (about 40%, credited at MID’s flat rate) | About 4,600 kWh × 7.6 cents = roughly $350 in export credits |
| What this tells you | Most of the value is in the power you use yourself, so sizing to your usage beats oversizing to export |
How MID net metering works now
MID credits new rooftop solar under its own net energy metering (NEM 2.0), and because MID is a municipal utility it is exempt from California’s NEM 3.0 net billing. This is the key difference from most of the state. California’s investor-owned utilities (PG&E, SCE, SDG&E) moved to NEM 3.0 net billing on April 15, 2023, which values exports well below the retail rate and pushes homeowners toward batteries (CPUC net energy metering). MID sits outside CPUC jurisdiction, so it never adopted NEM 3.0. Instead, MID tracks your usage and generation hourly, and the excess electricity you export to the grid is credited at 7.6 cents per kWh, shown as a credit on your monthly bill (MID Solar Program). For the mechanics of export credits in general, see how net metering credits your solar exports.
| MID (municipal) | PG&E / SCE / SDG&E (investor-owned) |
|---|---|
| Exempt from NEM 3.0; MID sets its own solar tariff | Under CPUC NEM 3.0 net billing since April 15, 2023 |
| Excess generation credited at 7.6 cents per kWh | Exports valued on avoided-cost rates, often far below retail |
| Batteries help but are not required to make solar pencil | A battery is usually central to the payback math |
| Lower underlying municipal rates than the CA average | Among the highest retail rates in the country |
A battery still helps a MID customer, because using or storing your midday solar is worth more than exporting it at 7.6 cents per kWh. But unlike an investor-owned-utility customer under NEM 3.0, you do not need a battery just to make the numbers work. To see how the bill credit lowers your monthly cost, read how solar lowers your electricity bill, and to weigh payback under MID’s export credit, see the financial case for whether solar panels are worth it.
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Why the Central Valley is a strong place for solar
Modesto sits in the heart of California’s Central Valley, which has one of the highest solar resources in the country and long, hot summers that drive heavy afternoon air-conditioning use. That combination is good for rooftop solar: your panels produce the most exactly when the grid and your home need it most. A typical 7 kW system here produces roughly 11,500 kWh a year (our PVWatts estimate above), enough to offset a large part of a summer-heavy Modesto electric bill. Because MID’s export credit is a flat 7.6 cents per kWh, the biggest value comes from using your own solar during the day rather than sending it to the grid, so sizing the system to your actual usage matters more here than chasing the largest possible array.
What changed federally, and what it means for Modesto customers
The 30% federal homeowner solar credit ended after December 31, 2025. MID’s net metering and its lower municipal rates did not change with it. The federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after that date, under the One Big Beautiful Bill Act, so a MID customer who buys solar with cash or a loan in 2026 cannot claim it (IRS OBBB FAQ; SEIA). A separate commercial credit, Section 48E, is claimed by the business that owns a leased or PPA system, not by the homeowner, so on a lease or PPA you do not file for a federal credit yourself. The 25D homeowner credit, by contrast, ended after December 31, 2025. For the full timeline, see what the federal solar tax credit change means in 2026.
How to connect solar to MID
Connecting a home system to MID follows a set order, and the key rule is that you cannot turn the system on until MID grants permission to operate. The general path is:
- Interconnection application. You or your installer file a MID interconnection application for your solar and any battery storage.
- Review and agreement. MID reviews the application and returns the interconnection and net metering agreement to sign.
- Install and inspect. The system is installed and passes your city or county electrical inspection.
- Meter set. MID installs or reconfigures a bidirectional meter and places your account on net metering.
- Permission to operate. MID issues permission to operate. The system may not run on the grid before this.
A licensed installer normally manages this whole process for you, and the details, forms, and fees can change, so confirm the current MID interconnection and net metering terms before you commit. For the questions to ask, see the right questions to ask a solar installer. You can also compare more utilities in our Solar by Utility guides, see statewide context on our California solar hub, and compare a fellow California municipal utility on our SMUD (Sacramento) solar guide.
How to choose a solar installer in Modesto
Modesto and the surrounding Stanislaus County area have an active solar market, so you have licensed installers to compare. Rather than chasing a “best” list, screen any installer against objective criteria:
- NABCEP certification, the industry’s professional standard for PV installers.
- Proper California licensing (CSLB) and any required local electrical and building permits.
- A clear workmanship and equipment warranty in writing.
- Real experience with MID interconnection and net metering, so the paperwork and permission to operate go smoothly.
- A written production estimate and a transparent quote that is honest about the 7.6 cents per kWh export credit and how a battery would change your payback.
MySolarFY matches you with licensed installers that serve your area so you can compare real local quotes side by side, with no obligation.
Frequently asked questions
Is Modesto under California’s NEM 3.0 net billing?
No. Modesto is served by the Modesto Irrigation District, a publicly owned municipal utility that sits outside California Public Utilities Commission jurisdiction, so it never adopted NEM 3.0. NEM 3.0 net billing applies to the state’s investor-owned utilities (PG&E, SCE, SDG&E), which moved to it on April 15, 2023. MID instead credits new rooftop solar under its own net energy metering, so the export rules in Modesto are set by MID, not the CPUC.
How does MID credit my exported solar in 2026?
MID tracks your usage and generation hourly and credits the excess electricity you send to the grid at 7.6 cents per kWh, shown as a credit on your monthly bill. Because that credit is below MID’s retail energy price, using your solar during the day, or storing it in a battery, is worth more than exporting it. Confirm the current export credit and residential rate with MID before you decide.
How big a solar system can I install in MID territory?
MID lets you size a system up to 115% of your annual demonstrated electricity use. That is meant to match your system to your own consumption rather than to build a large exporter, which fits MID’s flat export credit. Your installer will size the array from your past 12 months of usage, so have a recent MID bill handy when you get quotes.
What happened to the federal solar tax credit?
The 30% federal Residential Clean Energy Credit (Section 25D) ended for expenditures made after December 31, 2025, under the One Big Beautiful Bill Act. A Modesto homeowner who buys solar in 2026 with cash or a loan cannot claim it. A separate commercial credit (Section 48E) can apply to leased and PPA systems, but the business that owns the system claims it, not the homeowner. MID’s net metering was not affected by the federal change.
Do I need a battery to go solar in Modesto?
No, not the way an investor-owned-utility customer under NEM 3.0 effectively does. MID’s export credit means solar can pencil without storage, though a battery still adds value by letting you use your own solar in the evening instead of exporting it at 7.6 cents per kWh. Whether a battery is worth it depends on your usage and budget, so ask your installer to model both.
Do I qualify for the MID solar credit if I lease or sign a PPA?
The net metering credit follows your MID account, but on a lease or PPA the company that owns the panels typically keeps the incentives, while your benefit is a lower or fixed power price with no up-front cost. If you want the export credit and any tax benefits in your own name, owning the system through cash or a loan is the path that captures them.
Reviewed by the MySolarFY team. Figures were verified against the linked MID, California Public Utilities Commission, EIA, NREL PVWatts, IRS, and SEIA sources as of August 2026. MID’s net metering terms, export credit, and residential rates all change over time, so confirm current terms with MID before you decide. MySolarFY does not provide tax or financial advice; consult a licensed professional about your own situation. Learn more about the MySolarFY team and how we work.
MySolarFY is a free service that matches homeowners with licensed solar installers. We are not an installer, financing company, or government program. “No up-front cost” refers to qualifying lease or PPA financing, where eligible homeowners may have no out-of-pocket cost at installation. Lease and PPA terms typically run 20 to 25 years, may include an annual price escalator, and total payments may exceed the cost of a cash purchase; on a lease or PPA the incentives and bill credits often go to the company that owns the system, not the homeowner. Homeowners do not get the federal residential credit that ended after December 31, 2025. Solar panels are not free and monthly payments apply. Eligibility, savings, incentives, and rates vary and are not guaranteed. See our full disclaimer.
