What is Net-Metering
Solar net metering is a system that allows homeowners with solar panel systems to send excess electricity back to the grid, and in turn, receive credits on their utility bill. The concept behind net metering is simple: when your solar panels produce more electricity than you're using, the excess energy is sent back to the grid and your electric meter runs in reverse. On the other hand, when your energy consumption is higher than your solar panel production, such as during the night or on cloudy days, you'll pull electricity back from the grid and your meter runs forwards.
To understand how net metering works, it's important to know that a properly sized solar energy system can produce enough electricity to match a home's electricity use for the entire year. However, the amount of electricity your solar panels produce will vary throughout the year, with more production in sunnier summer months and less during the winter when the sun is lower in the sky and sets earlier. Net metering helps to account for these seasonal differences by crediting homeowners for the excess electricity their panels produce, allowing them to use it at a later date.
Net metering policies were implemented for two main reasons: to encourage the greater adoption of renewable energy and because utilities and the electricity grid as a whole can benefit from the influx of low-to-no-cost solar energy. With net metering, solar energy can help balance the cost of purchasing electricity from other resources, particularly during the summer months when electricity is often the most expensive on the hottest and sunniest days of the year.
When it comes to electricity bills, most homes will produce excess electricity in the summer months and use more electricity from the grid in the winter. Because these variations in production are predictable, utilities will not send homeowners a monthly check when they produce more than they need. Instead, homeowners will build up extra credits during the summer months to use during the winter. With the right design, a solar power system can generate enough power to match a home's total electricity use for a year, even if it produces much more than needed in some months and much less in others.
Homeowners will receive a credit based on the net number of kilowatt-hours they give back to the grid when their solar power system generates more electricity than they use over the course of a month. If they produce less electricity than they use in a given month, they must buy electricity from their utility to make up the difference. In these instances, homeowners would pay for the electricity they use, minus any excess electricity their solar panels generated.
Net metering is a great way for homeowners to save money by going solar. It allows them to store every unit of energy they produce with solar to be used at a later date from the grid. Thanks to net metering, homeowners can save tens of thousands of dollars over the lifetime of their solar panel system by offsetting their need for electricity from the grid. Not all states offer net metering, so it's important to check if your state has a net metering program or another type of solar compensation program. The Database of State Incentives for Renewables and Efficiency (DSIRE) tracks net metering and other solar incentives and rebates. By using tools such as the TexasGrid Solar Calculator, homeowners can see how much they can save with solar, and even receive quotes from local installers.
