[supertrope]

Solar net metering is a weird subsidy. The solar panel owners are not paid for the full value of the electricity they provide. The utility is not paid for the full value of the electricity distribution they provide (you can pull 240V x 200A on demand).

Net metering can only form a small part of the retail market before the fixed costs of distribution get concentrated on remaining customers in a death spiral. A population that is generally less able to take advantage of tax credits (because their tax liability is not high enough), and has less access to capital in the form of homeownership or financing for the solar system.

This is analogous to the "problem" of fuel efficient car owners paying less fuel tax. Some states have added higher registration fees on hybrids and EVs to offset the "lost" revenue. Another similar situation is water utilities that encouraged efficiency through higher rates. Customers saved water and then the utility had to increase per unit rates to maintain enough baseline revenue to cover fixed expenses of maintaining the distribution network to every home.

[s1artibartfast]

I don't think that is correct. With net metering residential solar owners are overpaid for the value of their power. More than commercial solar plants selling at the same time.

Homeowners may get paid less than their panels cost, but rooftop solar is tremendously expensive and there is no way that it would recoup the cost at actual market prices

[rcxdude]

It's somewhere in-between: residential solar, when feeding back into the grid, is only using a small fraction of the transmission compared to a commercial solar plant (in terms of length of wiring and number of transformers used to transmit a given amount of power). In fact, it will generally be (unless in a neighbourhood where nearly every house has solar installed) reducing the overall load on the grid. So it's not reasonable to expect that the value of that electricity is the same as that of the same amount coming from a large utility, but it's still probably not worth retail prices, either (though maybe it is, in certain circumstances. In cases with a very overloaded grid it may conceivably be worth more!)

[s1artibartfast]

the grid is a fixed cost, which is needed unless we are willing go without power every night and winter. Once it is in place, it costs the same if it is sitting idle or being used.

There are absolutely no savings from an unreliable local power source.