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What You Need to Know About Net Metering

net meteringIn today’s age of green initiatives encouraging at-home energy resources, there are many people taking advantage of generating their own electricity through solar power. With these types of self-produced energy, many residential customers are not using the city- and state-provided utilities network. In fact, the energy that they produce at their homes is often funneled back into the power grid where other local customers can use it. This phenomenon has led to the concept of net metering.

Defining Net Metering

Before the advent of net metering, the extra energy produced by solar-powered homes was simply unused, then lost. In order to take advantage of the excess energy produced by solar-powered homes, utility companies in charge of the grid began to credit those producers for adding home-generated energy for their own use and for the use of other customers. This billing and crediting system became known as net metering.

For example, a home with solar panels on the roof may be able to generate more energy during the daytime than the home needs to run electricity lines and appliances. If this solar-powered home is enrolled in net metering, its electricity meter will actually run backward during the hours it is over-producing, thereby creating energy credits. The homeowners can then use these credited hours either during the nighttime when solar energy is inapplicable, or for donation to the electric grid for other customers to use. With this system, energy-producing homeowners are only charged for the energy they consume from the outside grid, also known as their net use.

The Benefits of Net Metering

There are several benefits to homeowners that decide to enroll in net metering programs.

1. Customers have more control over their electricity bills:

Since many homeowners are already taking advantage of creating their own energy, net metering gives them the opportunity to take some control over their monthly electric costs. Most solar power users are able to produce a lot more energy during the day than they need to run their own homes, so net metering gives them a chance to make some profit from their personal systems. By using their stored energy credits later in the day and by exporting their extra power to the grid, these customers have the ability to reduce their personal electricity bills.

2. Jobs are created for energy workers:

The idea of lowering electricity bills is an incentive for many people to get involved in solar power. As more people become interested in this energy source, it will become necessary for more installers, electricians and maintenance workers to be employed to keep these systems functional. This means that net metering could potentially lead to the creation of new jobs.

3. The electric grid remains functional:

One major disadvantage of the increased use of technology in today’s society is the amount of electricity that these complex devices use. With many homes and businesses running multiple appliances and electronic devices at the same time, the power grid can become overtaxed. However, the addition of the net metering system allows many overstrained locations to reduce their electricity loads, providing better and safer service to customers.

4. It helps the environment:

Energy options like solar power are some of the cleanest and most environmentally friendly. Instead of mining the earth and burning fossil fuels, people can safely and easily harness the power of the sun to run their homes and businesses. With more people converting to solar power, the environment is preserved.

The Prevalence of Net Metering

Although net metering is not an option everywhere in the United States, 43 states and Washington, D.C., have implemented policies for this system. Even with this fairly widespread adoption, the requirements and benefits of net metering vary greatly from state to state without any kind of federal rules. Even with the option of net metering in place, very few solar-powered homes are currently taking advantage of this system.

Anyone interested in exploring the possibility of net metering would need to locate and examine the specific policies of their home state to get a better idea of the possibilities.

The Significance of Net Metering and Freeing the Grid

While the monetary benefits to customers who participate in net metering are undeniable, there is a bigger goal at stake with this practice. The ultimate goal for many homeowners, clean energy proponents and environmentalists is to free up the electricity grid.

The term “freeing the grid” most often refers to the idea of moving away from the traditional infrastructure created by widespread fossil fuel use. Utilizing fossil fuels, including coal, oil and natural gas, has long been the main method for keeping power going to homes across the United States. However, as time has passed and the availability of these fossil fuels has been reduced and become more expensive, many lawmakers, environmentalists and energy providers are looking for ways to lessen the country’s reliance on these traditional energy sources. Solar power has become one of the most promising methods.

By harnessing the clean energy of solar power and by providing participating homeowners with incentives, policymakers and energy providers have found perhaps the best practice for freeing the electricity grid. As policies for clean energy and net metering continue to be developed, this practice of utilizing available renewable energy resources and sharing them with other consumers makes the most sense as an efficient and cost-effective method of powering the nation.

Ryan McNeill is the president of Renewable Energy Corporation, one of the Mid-Atlantic’s largest residential solar energy companies – committed to installing quality, American-made solar panels and energy products for homeowners.

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