What is net metering?

net metering

If you’ve been researching solar panels for home, you know that net metering is a hot topic (pun intended) right now. Homeowners with solar panels are touting the monetary benefits of net metering, but if you’re new to solar, the details can be overwhelming. We’re here to help you understand the ins and outs of net metering. Here’s what customers like you need to know.

electrical meter

Net Metering 101

What is net metering?

When your solar panels are overachievers, or if you tend to use less electricity than average, you may benefit from net energy metering (NEM), or net metering. Simply put, net metering is a billing agreement between customers like you and your utility company. It allows you to receive credits on your electricity bill when your solar panels produce excess electricity and sends that electricity to the power grid.

Net metering has positives for both parties involved. It takes a load off power plants by extending their operation times, maintaining their expenses and need for upgrades. Also, because solar power is generated during peak daytime hours, utilities can provide more electricity during peak times. They can do this without investing in more infrastructure.

When your solar panels don’t get enough solar power to meet your electricity needs, you can pull energy from the grid. You use the net metering credits you’ve accumulated to help offset your utility bill. You’ll most likely use these net metering credits at night or during the winter. So not only are you creating your own electricity with your solar energy system, but you are also saving money on electricity you draw from your utility. Not a bad deal!

How is it measured?

Solar energy systems are designed with specific components. The components measure the kilowatt hours (kWh) flowing from your solar panels to your home and from your solar panels to the power grid.

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How do I know if I’m eligible for net metering?

We hope this is already obvious, but if not, the first requirement is you need a solar panel system installed on your home. (Hint: contact us, we make going solar as easy as possible for you!) From there, it gets tricky. Your net metering eligibility is based on your state and local utility company. Many states and utility companies are still figuring out how their business models should adapt to this newer agreement, so you may have noticed some squabbling in this area.

Your best bet? Check the specific net metering requirements for your state and utility. You can find helpful policy links and resources by the state at DSIRE - but also be sure to visit your state and utility website for the most up-to-date information. If net metering is set to expire after a certain date in your area, take note of that as well as what policy or policies are slated to replace it.

Plenty of perks to going solar

If your local utility doesn’t offer net metering services or benefits, don’t fret. Your state may offer different types of compensation for distributed generation and for having a solar energy system. Be sure to check your state’s .gov site and/or your utility’s website to find out what’s available. You may be eligible for tax incentives and other clean energy credits. Read more about solar tax incentives and credits.

More about net metering

Have more questions about net metering or solar? Send us a holler. We know that going green is like climbing a mountain: it takes a series of small steps to get to the summit. We want to make sure customers like you have all of the resources you need before you make that climb. While you’re at it, find out how much solar panels cost and what the solar installation process is like.

See how much solar could save you!

To get a free quote, call 877.987.5591 or fill out the form below.

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