In Focus: Net Metering

net metering1 In Focus: Net Metering

Let’s say you are interesting in generating your own electricity. There are a couple of intuitive benefits. First off, you don’t have to pay that nagging electricity bill. Secondly, you can have the peace of mind that your lights aren’t powered off of dirty coal smoke. However, for most states there is also another benefit. For those independent electricity generators making their own power, there is actually the option to sell your electricity back into the grid. This process is commonly known as ‘Net Metering’.

Why such a fancy name for such a simple concept? Well, like most things in the energy world, Net Metering arose from a jumble of economic and engineering terms. The ‘net’ refers to the total amount of electricity and the ‘meter’ refers to the electricity meter outside of your house. You remember that weird looking circle with a bunch of spinning clock-like things?

Most of the time, those ‘clocks’ spin clockwise, and although they are fun to watch, they also cost you MONEY every spin they take.

However, under Net Metering, the rules work a little differently. Perhaps you have a PV solar unit on your roof and your state has net metering laws in effect. Whenever you generate more electricity than you use (perhaps when you are at work at the sun is beating down on your roof with no one home) you make money!

As simple as that. Imagine going home one day and getting a letter from your electric utility, and inside is that dreaded bil…wait, what’s that? A check? From utility to you? Talk about your lucky day!

Well it’s not luck, its net metering, and it’s just another reason why installing solar cells, small scale wind, or even small hydro is an economically viable way to produce electricity.

Net Metering… in depth:
Within the United States, all public electric utilities are required to make Net Metering available to their customers. This was stipulated by the Energy Policy Act of 2005. To read more check out: http://doi.net/iepa/EnergyPolicyActof2005.pdf

Some states offer a bolster on Net Metering known as Feed-In-Tariff’s (or FIT’s). Usually, net metering pays the customers the same price as the retail price for the electricity they produce (i.e. if you get charges 10cents per kWh, then when you produce a kWh, you get paid 10 cents). However, under the FIT system, you would get paid say 15cents for a kWh when the usual price was 10 cents. FIT’s are usually awarded on a contract basis providing a guarantee of renewable energy production over the course of many years.

For more on FIT’s check out www.nrel.gov/docs/fy09osti/45549.pdf

For specific information on where Net Metering and FITs are offered, take a look at www.energygridiq.com for details.

Original Article on EnergyGridIQ