What is Net Metering?
Investor owned utilities are required to offer Net Metering to their customers in MA and most other states. Net Metering allows solar system owners to get credit on their bill for the net excess solar energy produced by their system or allocated to another site within the same utility territory. Net metering credits are equal to the utility’s full retail rate for for solar facilities. Credits may be carried forward indefinitely.
For example, if a residential customer has a grid-tied solar photovoltaic system installed, it may generate more electricity than the home uses. Solar installations are connected to a meter, which will measure the net quantity of electricity that the customer uses (“retail meter”). The retail meter spins forward when the customer uses electricity from the distribution company, and it spins backward when the customer generates excess electricity (thereby “exporting” electricity to the electric grid). A special retail meter (also called the “net meter”) is required to allow for the “netting” of usage and generation, especially when there may be exporting of electricity. Customers are only billed for their “net” energy use. Net metering policies allow distributed generation customers to sell excess electricity to a utility and receive retail credit on their utility bill. This credit offsets the customer’s electricity consumption during other times of the day or year, thereby reducing the amount of electricity that a customer purchases from a utility.
On average, only 20-40% of a solar energy system’s output ever goes into the grid. Exported solar electricity serves nearby customers’ loads.