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Everything You Ever Wanted To Know About Net Metering

Everything-You-Ever-Wanted-To-Know-About-Net-MeteringSo, you’ve heard all the great stuff about solar—it saves you money, it’s good for the environment, and sometimes your electric company will even give you credits. You’ll have grid independence and never have to worry about ridiculous energy bills again, all because of a wonderful little thing called “net metering”.

Wait. Hold up. What’s that?

We get a lot of questions about net metering, how it works, and why on earth tracking your energy use matters if you have your own energy production facility right on your roof. We did a round-up of some of the most common questions folks ask us about net metering, and here are the answers:

What Is Net Metering?

Net metering is, essentially, a billing agreement between you and your utility company. When you install a rooftop solar system, it functions as a tiny power generator, able to both draw from and contribute to the main grid in your area. Net metering is the method by which the electric company tracks your solar system’s give-and-take from the grid and bills or credits you appropriately.

How Does It Work?

When you’re eligible for net metering, a bi-directional meter will be installed in your solar system to track the kilowatt hours (kWh) flowing from your solar panels to your home and from your solar panels to the power grid. When you generate more power than you use in a day, that energy is sent back to the grid, and you are credited for your contribution. On months where you consistently generate more energy than you use, you’ll receive a negative electric bill.

What Are The Benefits Of The Net Metering System?

Remember we just talked about negative electric bills?  Net metering allows you “bank” those credits through the “non-air conditioning” months when solar systems are producing more energy that is being consumed.  Then as it gets hotter and the air conditioning is running, those credits get consumed.

For the homeowner, this system is a great way to increase the value you get out of your solar system. Now, you’re able to not only generate power for yourself and your family, but you can contribute to the electric needs of your community as well—plus, you get paid for it. This system has been shown to demonstrate a significant value to both local economies and utilities.

Fun fact: This system is actually also beneficial for the electric company, since it allows them to better manage load during peak times and reduces distribution load. 

Is Net Metering An Option For Me?

State policies regarding energy tracking can vary, although net metering is considered standard. In Louisiana, Hawaii, Alabama, South Dakota, and Tennessee, for example, energy policies range from “gross metering”, to feed-in tariffs, to no net metering options at all. In Texas, however, most major utility companies offer their customers net metering—despite it not technically being mandated on the state level. For a complete list of what options are available in your state, check out the Database of State Incentives for Renewables & Efficiency.

If you’re on the fence about going solar and taking advantage of the savings opportunity that net metering offers, we recommend checking out a good solar calculator. You can get a good look at what’s available in your zip code, how many panels you need to meet your energy needs, and decide if solar is a good fit for your budget. Rather talk through all of this with a human? We get it, solar is a big commitment and sometimes you need expert advice. Contact us today to get your free quote!