Is solar worth it in North Dakota in 2026?

How North Dakota pays for your solar power

Net metering at the retail rate. PSC rules make investor-owned utilities net solar systems up to 100 kW per billing period; leftover exports earn avoided cost (3.416 cents/kWh Montana-Dakota, 3.646 Xcel). Co-ops set their own terms.

In the calculator, 40% of your solar output is used at home at the retail price and the rest is exported at about 100% of retail (our default for this kind of rule), so each solar kWh is worth 100% of the retail price on average. Change it if your utility pays more or less. Method

State or utility incentive	What it is worth
Property tax exemption for solar equipment (NDCC 57-02-08, subsection 27)	Solar power equipment in new or existing buildings is exempt from property tax for five years after installation

How exports are credited

North Dakota has no net metering statute. The rule is a Public Service Commission (PSC) administrative rule, section 69-09-07-09 of the state code. It says qualifying facilities with a design capacity of 100 kilowatts or less are entitled to net energy billing “where the output from the qualifying facility reverses the electric meter” used to measure sales from the utility. It binds the investor-owned utilities the PSC regulates. Co-ops and municipal utilities set their own terms.

The three investor-owned utilities each file a tariff, and the PSC reviews the buyback rate every year.

Montana-Dakota Utilities (Rate 95). Customers with systems of 100 kW or less can choose net billing. Metered generation is subtracted from metered consumption for the billing period. If generation is lower, you pay the retail rate on the difference. If generation is higher, the surplus is paid at 3.416 cents/kWh, the rate the PSC approved on December 17, 2025 for service from January 1, 2026. The generator and the load must be on the same physical site, and the contract runs at least one year but less than five. The other option is simultaneous purchase and sale: you buy everything at retail and sell everything at 3.416 cents.

Xcel Energy (Net Energy Billing Service, rate code D50). Available to systems of 100 kW or less. Energy you use beyond what your system delivers in the same billing period is billed at the normal retail rate. Energy delivered to Xcel is paid at 3.646 cents/kWh, effective March 1, 2026. The metering charge is $3.25 a month for single phase.

Otter Tail Power. Its rider for systems up to 100 kW pays 4.571 cents/kWh base avoided cost plus 0.096 cents for the renewable energy credit and 0.300 cents for the solar credit, effective June 1, 2026. The rider describes payment for energy received from the system and requires a contract of at least 12 months. Its text does not state that your own use is offset first, so ask Otter Tail how a rooftop system would be billed.

Because the monthly netting at MDU and Xcel offsets your own use at retail, this is classified as net metering. Only the leftover surplus earns the low rate.

State incentives in 2026

• Property tax exemption: NDCC 57-02-08(27) exempts installations and equipment that produce electrical power from solar energy in new or existing buildings, for five years after installation, on locally assessed property.

The state income tax credit for solar (NDCC 57-38-01.8) covers devices installed before January 1, 2015, so it is not available. No statewide residential solar rebate was found. The federal residential credit ended for systems installed after December 31, 2025. See the federal credit explainer.

What it means for payback

The big gap is between the retail rate and the 3.4 to 3.6 cents paid for surplus. Self-consumption is what pays. Size the system to your annual use, not above it, because kilowatt-hours exported beyond your monthly use earn very little. At 12.36 cents/kWh average retail, a surplus kWh at MDU’s rate is worth about 28% of a kWh you avoid buying, so a surplus-heavy design loses a large share of its value.

Netting happens within each billing period, and the tariffs reviewed do not describe banking surplus into later months. Summer overproduction therefore does not offset winter bills. A battery shifts midday output into the evening, which is worth considering when surplus is large; see are solar batteries worth it and net metering vs net billing.

Other rules worth knowing

The PSC rule lets a utility recover metering costs for production monitoring, and the tariffs add monthly metering charges (MDU $0.06 a day single phase, Xcel $3.25 a month, Otter Tail $1.33 a month). Xcel’s tariff also makes the system owner pay interconnection charges for any changes to utility facilities.

The buyback rates are reset every year, so the surplus price can move. Confirm the current figure before you sign.

Customers of rural electric cooperatives and municipal utilities fall outside the PSC rule. Ask your co-op for its interconnection and buyback terms before ordering a system.

Berkeley Lab does not publish a North Dakota median from enough systems, so the calculator starts from the U.S. median of $3.60/W. Put your own quote in.