How Does Net Metering Work With Solar?

October 31, 2019

Are you thinking about going solar? Wondering how your home will be powered at night when there is no sun? Or maybe you are thinking, “How will I save money without buying an expensive battery to store all of this power?” Thanks to net metering, you can easily solve these obstacles with no extra expense. Net metering is a beneficial resource for solar system owners. Many making the switch to solar wonder how they will power their home at night when there is no sun to power their panels. Others want to maximize the cost benefits that their system can provide. Net metering offers solutions to both concerns. 

What exactly is Net Metering?

Net metering or Net Energy Metering (NEM) is an incentive billing mechanism that allows solar system owners to receive credits for excess power produced. When your system generates more energy than needed, the extra energy transfers to the grid to power other homes. This transfer is then exchanged for credits. Customers are paid at the same rate as utilities would cost from the power company. Similarly, when your panels are not producing energy, you can retrieve this energy from the grid by using the credits.

A system of the right size for your home will produce enough electricity to meet the total energy usage for the year. Net metering allows customers to control their electricity bills through a two-directional path between their solar system and the grid. This way, the cost of electricity is neutralized by using credits received for excess production. Conversely, homeowners can use their credits to retrieve energy from the local grid when solar panels stop producing power at night.

How net metering works

Solar systems tend to hit their peak performance during the afternoon. Often during this time, systems produce more electricity than we consume. So, an inverter turns your solar system’s direct current (DC) into an alternating current (AC). It then exports this electricity through the power line to the grid. Your electric meter runs backward when the grid collects that excess power. Then, while your solar system is dormant at night, the credits you receive for this extra energy pay for the power pulled back from the grid. This excess energy also compensates for other times when your solar system is underproducing.

Net metering ensures that no energy goes to waste. It also compensates for any needs during shortages throughout the year. When more power is generated than what is used in a month, credits will be supplemented to your utility bill.

This credit is based on “net” energy usage or the difference between the energy produced and consumed energy. If the system does not generate enough energy to meet your monthly needs, you must purchase this power from your utility. In this case, your utility company subtracts excess energy from your usage, and you pay the difference.

We have put together a map, below, of Net Metering Policies by state:

Net metering provides valuable incentives for solar energy users. It benefits both those with solar energy and those without. It generates power for solar homes when they are underproducing. Net metering also provides extra clean energy to those who do not have solar systems. Take advantage of lower utility bills, cleaner energy, and reliable service by going solar today. Contact us at Everlight Solar for a free consultation.