Sell energy back to the power grid with net metering

How does net metering make money?

Solar has some complicated terms, like “net metering” which often confuse customers that are not educated in solar energy. Here ar Solarize, we’re always looking for ways to educate the consumer so that they have the tools and information they need to make a smart choice if they are considering solar energy as an alternative. Today we will discuss net metering.

In a nutshell net metering allows residential and commercial customers who generate their own electricity from solar power arrays to feed the electricity they do not use back into the power grid. Here in Nevada, NV Energy offers a net metering program as a result of regulatory decision. This means that in the constantly sunny sate of Nevada you can install a solar array and generate energy that can be sold back to the power company to lower you bill and in some cases for a profit.

Net metering is essentially a billing mechanism that credits back solar energy system owners for the electricity they add to the grid. For example, if a residential customer has a photovoltaic (PV) system on the home’s rooftop, it may generate more electricity than the home uses during daylight hours. If the home is net-metered, the electricity meter will run backwards (you ever seen that, it’s pretty cool) to provide a credit against what electricity is consumed at night or other periods where the home’s electricity use exceeds the system’s output. Customers are only billed for their “net” energy use. On average, only 20-40% of a solar energy system’s output ever goes into the grid. Exported solar electricity serves nearby customers’ loads.

net metering example

Net metering also allows utility customers to generate their own electricity cleanly and efficiently by “borrowing” it from solar panel arrays. During the day, most solar customers produce more electricity than they consume; net metering allows them to export that power to the grid and reduce their future electric bills. Here in Nevada that means that NV Energy has to burn less coal to generate electricity during the day, which in turn helps to lower it’s carbon footprint, save on it’s resources, as well as generate credit for the solar customers that are feeding into their grid.

Net metering creates a smoother demand curve for electricity and allow utilities to better manage their peak electricity loads. By encouraging solar generation near the point of consumption, net metering also reduces the strain on distribution systems and prevents losses in long-distance electricity transmission and distribution.


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  1. […] reduce your utility bills and you’ll still save a lot of money. Here in Nevada, there is a net metering deal with Nevada Power that allows for a 95% buyback offset. For example, that means that if you have a […]

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