{"id":5900,"date":"2022-10-14T11:36:00","date_gmt":"2022-10-14T11:36:00","guid":{"rendered":"https:\/\/www.portal.solar.com\/learn\/what-is-net-energy-metering\/"},"modified":"2023-12-28T17:34:53","modified_gmt":"2023-12-28T17:34:53","slug":"what-is-net-energy-metering","status":"publish","type":"post","link":"https:\/\/www.solar.com\/learn\/what-is-net-energy-metering\/","title":{"rendered":"What Is Net Metering And Which States Have it?"},"content":{"rendered":"

There are plenty of industry terms to keep track of when you\u2019re shopping for solar and net metering is among the most important.<\/p>\n

Also referred to as net energy metering and NEM, net metering is a billing system that answers the age-old question: \u201cHow does solar work when the sun isn\u2019t shining?\u201d<\/p>\n

If you\u2019re thinking about going solar, it\u2019s important to understand what net metering is, how it works, and if it\u2019s available in your area.<\/p>\n

See how much you can save with solar. Start here.<\/a><\/p>\n

What is net metering?<\/h2>\n

Net energy metering is a billing mechanism that allows you to earn credit for excess solar production on sunny days to offset the grid energy you consume when your panels aren\u2019t producing.<\/strong><\/p>\n

One way to think of net metering is spinning your energy meter backwards when you send excess solar electricity onto the grid.<\/p>\n

Homeowners typically size their solar systems offset 100% of their electricity use, which means they push as much electricity onto the grid as they pull off of it. With NEM and 100% solar offset, you essentially replace your electricity bill with lower monthly payments on your solar panels.<\/p>\n

Once the system is paid off, you\u2019re paying for neither and the savings start to kick in!<\/p>\n

How does net metering work?<\/h2>\n

Let\u2019s say you have a 7.5 kW solar panel system in New York State. On a nice June day with 6 hours of peak sun your panels produce around 32 kilowatt-hours (kWh) of electricity, but you only use 25 kWh of electricity to power your house.<\/p>\n

That 7 kWh of excess production goes back into the local grid to power systems like your neighbor\u2019s refrigerator. As your electricity flows onto the grid, you earn credit which is used to offset the grid energy you use when your panels are producing.<\/p>\n

\"net<\/p>\n

At the end of the billing year you will \u201ctrue-up\u201d with your utility company and only pay for your grid electricity use minus<\/em> the solar electricity you put on the grid.<\/p>\n

If you have an exact 100% offset, you won\u2019t owe a penny. But it\u2019s more likely that your solar panels will slightly overproduce or underproduce your electricity consumption, in which case you may have a small bill or leftover credit at the end of the year.<\/p>\n

Even though our power demand is not perfectly aligned with solar production, NEM allows solar to be a viable energy option by allowing homeowners to push and pull from the local grid — essentially using it as a giant battery backup.<\/p>\n

Advantages of net metering<\/h2>\n

There are several advantages to net metering \u2013 from financial to environmental. Let\u2019s look at a few.<\/p>\n

Electricity Savings<\/h3>\n

The biggest advantage of net metering is the opportunity for substantial solar. The national average price for grid electricity is 16.7 cents per kWh<\/a> (and rising) while the average price per kWh for solar<\/a> through solar.com is closer to 7 cents per kWh.<\/p>\n

Through NEM, you essentially replace your grid electricity rate with a much lower rate for solar power. Over the 25-plus year life of a solar system, that leads to tens of thousands in electricity savings.<\/p>\n

Increased solar adoption<\/h3>\n

The biggest knock on solar energy is that it is inherently intermittent. Yes, your Uncle Todd was right at Thanksgiving \u2013 solar panels only produce electricity when the sun is shining.<\/p>\n

Net metering solves that problem and was largely created to increase solar adoption. When the sun is shining, your house runs on solar. When it’s not, your house runs on grid.<\/p>\n

All the while you’re only paying for your solar equipment, and at a much lower rate than paying for grid electricity. This simple yet effective billing structure has made going solar more than worthwhile and increased the rate of adoption.<\/p>\n

Related reading: Solar Rebates and Incentives 2022<\/span><\/a><\/p>\n

Cleaner, cheaper electricity mix<\/h3>\n

It\u2019s not just solar owners that benefit from net metering. Utilities, communities, and the global ecosystem all benefit from clean, cheap electricity generated by rooftop solar.<\/p>\n