Net metering ( i.e. also known as net energy metering or NEM) is a solar incentive which enables you to store energy in an electric grid. When your solar panels generate more electricity than your requirement, that energy is sent to the grid in exchange for credits through NEM. Then, during night or other times when your solar panels are under-producing, you drag energy from the grid for using these credits to balance the costs of that energy.
Concept of ‘Behind the meter’
It is very obvious that you expect your electricity meter to know how much energy you use.
But generating your own electricity requires a whole new thought. You might be surprised to know that the meter installed by the electricity retailer does not know and cannot know that what is going on with the electricity of your home.
When you have surplus solar, your meter cannot see how much electricity is generated by the solar system and how much is being used by your home. It can only measure the exported solar energy.
For example, if you’re exporting 3 kW of surplus solar your meter doesn’t know if you’re generating 4 kW and using 1 kW, or if you’re generating 5.5 kW and using 2.5 kW. It only knows that the difference is 3 kW.
What is the working process of net metering?
During the middle of the day, your home’s solar energy system generates the most electricity. But at the same time, your home utilises the least amount of energy. It means that your system produces a lot of excess power due to the combination of high output and low usage during the day time .
You can export this surplus electricity to the power grid with the help of net metering, which can then be provided to other consumers.
During the evening, the power flow shifts. Your solar system stops generating power and you start importing power from the grid.
The draw of net metering is this: the power you export will be subtracted from your grid energy usage — usually on a 1:1 basis per kWh.
In other words, you don’t pay for all the power you import from the grid. Instead, your power exports cancel out some, or even all, of your grid usage. This means you only have to pay your utility the ‘net’ difference. That’s why it’s called net metering!
· In an electric solar system which is also joined with the utility grid, the Direct Current(DC) power from the solar array is transformed into 120 or 240 volt AC power and supplied directly into the utility power distribution system of your home or building.
· When the solar array is generating electricity, the power is “net metered,” which means it reduces demand for power from the utility, hence it lowers the utility bill.
· If utility power goes offline, these grid-tied systems automatically shut off protecting workers from power being back-fed into the grid at the time of an outage.
· These types of solar-powered electric systems are known as “on-grid” or “battery-less” systems and make up approximately 98% of the solar power systems being installed today.