net metering

Net Metering - connected to the smart grid

What is net metering?

Net metering or net energy metering is an electricity policy that allows utility customers to offset some or all of their energy use with self-produced renewable energy. Net metering works by utilizing a meter that is able to spin and record energy flow in both directions. The meter spins forward when a customer is using energy from the utility grid, and reverses, spinning backward when energy is being sent back into the grid (at times when a customer is producing more energy than they are using). At the end of a given month the customer is billed only for the net energy used.

Why is net metering important?

Solar and wind energy systems are intermittent sources. At times when you are producing more electricity than you are using, you will be paid equitably for this, instead of having to store the excess in expensive batteries or have it go to waste. Net metering makes home renewable energy systems more effective and efficient.

How do I make use of net metering?

Contact your local utility to let them know you have an alternative energy system. You need to know the local and state laws concerning net metering in your area.

Who can use net metering?

Net billing is most suited to conventional spin meters that will automatically spin backward if you are producing more electricity than you are using. Some newer meters are less adaptable to net metering -- your solar installer will be able to help you.

Which states have net metering programs?

More than thirty states have recognized the environmental benefits of net metering and have passed legislation allowing the interconnection of small-scale renewable energy systems to the state’s power grid. You can find out more about net metering by contacting a wind energy or solar energy dealer or by contacting your local utility provider. For a comprehensive summary of state initiatives on net metering and other renewable energy incentives at the state level, visit the Database of State Incentives for Renewable Energy (DSIRE).

What are some benefits of net metering?

Net metering:

1. Offers incentives for utility customers to invest in nonpolluting, renewable energy sources
2. Is easily adaptable to all forms of small-scale electrical generation.
3. Simplifies interconnection processes, technically and administratively, for utilities and consumer generators.
4. Decentralizes generation in a flexible way, benefiting the utility’s power distribution profile.
5. Enhances the competitiveness of “green power” sources with respect to more conventional sources of energy.
6. Provides an equitable way of “banking” a home’s surplus power with the utility.
7. Customers tend to use less energy than the average retail customer, as they are more aware of their energy consumption.