What is Net Metering?

Net Metering measures the difference between the electricity you buy from your utility and the electricity you generate using your own solar electric system. Your meter keeps track of this difference as you generate electricity and take electricity from the electricity transmission grid. When you generate more than you use, your electric meter spins backward!

How does Net Metering work?

The Net Metering program uses a bi-directional meter to measure and/or track the "net" difference between the amount of electricity you produce and the amount of electricity you consume during each billing period. This can be accomplished on a cumulative basis or on a time-of-use basis, depending upon your rate schedule.

At the end of each billing period, you may receive a credit for any energy you have generated that is in excess of the energy you have consumed. If your energy consumption is greater than your energy produced you will be billed for the net difference.

What are the benefits of Net Metering?

Net metering is designed to reduce demand during long hot summer days when energy demand is heaviest, while providing energy credits that allow solar producers to reduce or eliminate their annual electric bill.

Net Metering offers additional benefits, depending on the size of your generating system. If you purchase a smaller, less expensive system, you can still offset most or all of your electricity needs because of the higher value of your excess electricity. If you purchase a larger system, you can "bank" or store your excess electricity on the grid and offset all of the electricity you would otherwise purchase from your utility

Common Misconceptions

1. If my generating system produces more electricity than I need, my electric service provider must buy it from me.
   
   False: Electric service providers may, but are not required to, purchase any excess electricity you produce at the end of each year of your net metering agreement. State law specifically states that your electric service provider does not have to buy your net generation. However, some utilities, especially those specializing in selling "green" electricity, may be willing to buy your excess solar or wind electricity for resale to their other customers.
   
   
2. My electric service provider will pay me full retail rates for my excess electricity.
   
   False: If they are willing to buy this "net" annual generation, they do not have to pay you full retail prices for it. While the actual rate paid would be up to the electric service provider, it would likely be less than retail and closer to "wholesale" rates, which are much lower.
   
   
3. I will have to spend hundreds of dollars on special meters, inspections or fees to get my system hooked up to the electric grid.
   
   False: You are only responsible for having a simple, bi-directional meter, the type you probably already have. If your generating system meets national safety and performance standards, you cannot be charged for additional tests, certification or fees.
   
   
4. The kilowatt-hours of electricity I might still need to buy from an electric service provider will cost me more than before I became a net metered customer.
   
   False: Your electric service provider cannot charge you anything extra for being a net metered customer and no charges can be imposed on the electricity you generate.

Time of use net metering employs a specialized reversible meter that is programmed to track electricity use during different periods of the day, which may also vary with differing seasons.

Times of use rates reward customers during peak hours when they conserve electricity because demand for energy is highest. Peak hours occur during midday and evening hours and off-peak periods are generally during the overnight and weekend periods.

There are several structures to fit the needs of each company. The utility companies will perform a comparison for a customer to provide the best possible scenario for their electric usage.