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Net Metering Guide: How the Utility Credits You for Solar Power. Solar generation meter

Net Metering Guide: How the Utility Credits You for Solar Power. Solar generation meter

    Net Metering Guide: How the Utility Credits You for Solar Power

    Grid-tie solar system owners receive credit for sending electricity into the public utility grid. They use those credits to offset their energy bill. This agreement is outlined by your utility’s net metering policy, which sets the rates at which interconnected solar customers buy and sell electricity.

    When you go solar, you need a way to store the energy generated by your panels. The easiest method is to hook into the utility grid to store energy and save it for later use.

    But to do that, you’ll need to agree to terms with the utility company that outline how you are credited and billed for power. These policies are referred to as net metering (or net energy metering) agreements.

    Under a net metering agreement, the grid acts as energy storage for the solar homeowner, banking the power they generate so they can use it later. The utility tracks your meter to record your net energy usage (energy consumed minus energy sent to the grid) so they can bill or credit your account based on overall usage.

    Net metering agreements benefit both parties. The homeowner has a way to store solar power for later use, and the utility benefits because the extra supply of electricity smooths the power demand curve and prevents outages.

    Each utility company has different terms and conditions, so it’s important to contact them before going solar to figure out how the connection process works. This article covers some of the most common agreements so you know what to expect.

    Types of Net Metering Agreements

    What is Net Metering?

    In broad terms, net metering is an agreement with the utility company that allows you to get credit for solar energy sent into the grid. The utility gives you a credit for the solar electricity you generate, and you can use those credits at any time to draw power from the grid.

    The utility monitors the meter on your property to track how much energy you use. If you withdraw more than you produce, you pay the utility for any extra usage.

    If you produce more power than you use in a given month, any excess production is credited to your account and rolled over to future months. These credits can be “banked” for periods of low production, meaning credits you earn in August can be used in December when the days are shorter and the weather is worse.

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    Under most net metering agreements, the utility will reimburse you for excess generation, either through a check or energy credits toward your future bill. However, most utilities pay reimbursements at a wholesale rate (vs. awarding credits at retail rates), so most folks choose to take the credit.

    What is a Feed-In Tariff?

    Most net metering agreements use one meter to track net energy consumption (energy used minus energy generated from solar) and bill everything at a uniform rate.

    Under a feed-in tariff, the utility installs two meters: one for the power you use, one for the power you generate. Each meter is billed at a different rate.

    Feed-in tariffs are typically implemented by local governments to incentivize people to switch to renewable energy sources; the utility pays a premium rate to encourage solar adoption. For example, you might buy power at 0.12/kWh, but sell excess power to the utility at 0.25/kWh.

    What is Net Purchase and Sale?

    This is essentially the opposite of the feed-in tariff structure. The utility still installs two meters, but they charge electricity at retail rates and buy it from you at reduced wholesale rates.

    Under this billing structure, the utility only pays their “avoided cost” for anything you feed into the grid—the cost they would have paid to generate that electricity.

    This is not as good a deal for the consumer as the regulated feed-in tariffs, but it’s still decent because you can receive payment for surplus generation.

    What is Aggregate Net Metering?

    Aggregate net metering allows for multiple meters on a property to be offset by a single solar system.

    Let’s say you live on a ranch property with your home, a barn, and a workshop, each with separate meters. Under this agreement, all three meters are counted toward the total net energy use on the property.

    This works the same as ‘standard’ net metering. The only difference is that it allows you to track more than one meter on a property.

    What is Virtual Net Metering / Community Solar?

    Aggregate net metering allows a single customer to offset multiple meters on his or her property.

    Virtual net metering differs in that it allows multiple customers to participate in net metering with a shared solar energy system.

    Under this policy, shared residences like apartment buildings can build a centralized solar system, with individual tenants metered and billed under their own account.

    Similarly, neighborhood residents can build a community solar farm to supply power to multiple homes in the neighborhood. Those who choose to buy into the community solar program receive an ownership stake in the shared system. They would be entitled to credits and/or reimbursement in proportion to their ownership stake in the system.

    What are Time-of-Use Rates?

    Lastly, your net metering policy may be affected by time-of-use (TOU) rates. Under a TOU policy, the utility charges more for electricity during peak demand periods, when people are home from school and work in the evening.

    Where applicable, net metering calculations are affected by TOU rates. Solar generates energy during off-peak hours (when the sun is out during the day), so that production is credited at a lower rate. When you flip on lights in the evening, you are billed a higher rate for usage during peak periods.

    The result is that you can generate enough energy to cover your usage and still end up paying a bill, because you pay a higher rate to use energy in the evenings than the rate you are credited for producing during the day.

    To counteract this, you can invest in an energy storage system that allows for TOU offset. A small battery bank can store daytime production for use during peak periods. By drawing power from your battery bank (instead of the grid) in the evening, you avoid paying higher rates during peak usage periods and maximize the value of your solar production.

    Net Metering Caps and Restrictions

    Some utilities have restrictions and caps on their net metering policies. These restrictions are in place to level out supply and demand, and to prevent people from taking advantage of the policies purely for profit motive (since you can make money by selling off surplus energy).

    These restrictions may include:

    • System size caps: either a concrete limit (systems up to 1 MW) or a percentage (125% of consumption)
    • Technology restrictions: outdated or inefficient technologies may not be eligible
    • Credit rollover limits: credits can expire and be surrendered to the utility if not used within a certain timeframe
    • Property type: residential, commercial and industrial properties may have different policies
    • Renewable energy source: Aside from solar, net metering policies may apply to wind, hydro, fuel cells, biomass, geothermal, and other renewable energy sources.

    Next Step: Understand Your Local Net Metering Policy

    Thinking of going solar? Contact your local utility a call and ask about their net metering policies. Many have their policies published online.

    They’ll explain how they credit you for solar energy produced, which is important to understand if you want to get the most out of your system.

    For more help on permitting and interconnection with the utility, grab a copy of our free solar permitting guide!

    What Distributed Generation and Net Metering Mean for You

    The way electricity will be generated and distributed in 10 years will likely be much different than it is today. These changes are made possible by utility investments and government initiatives to modernize the grid, including the American Recovery and Reinvestment Act of 2009. Residential consumers and businesses who generate their own power at or near the point of use, a process known as distributed generation (DG), may be some of the greatest beneficiaries of Smart grid technology. DG systems commonly utilize the natural resources available at their location such as the sun or wind. The Smart grid helps utilities reliably and efficiently accommodate a greater number of DG system operators than a traditional grid would otherwise be able to handle, thus giving you more choices when it comes to your energy.

    We’ve answered some common questions about DG to help clear up what this means for you:

    How does the Smart grid help you if you already have or are interested in adding distributed generation?

    Although utilities make the delivery of electricity look simple, it’s not—the amount of electricity being generated must precisely match the amount of electricity being used at any point in time. The Smart grid enables utilities to better manage the variability that goes along with integrating all forms of DG, but particularly renewable forms of DG like solar panels dependent on environmental conditions such as the sun shining. Distributed battery storage presents significant advantages over traditional grid infrastructure, especially when used for the mitigation of the variability of solar and other irregular generation sources. However, battery storage is still expensive and high are expected to continue to limit its wide-scale availability.

    Why would you want to install a DG system?

    Several types of benefits may be available to DG system owners depending on their state’s DG regulations. Find your state’s incentives and policies through DSIRE. Some benefits may include:

    • Lower electric bills
    • Reduced carbon footprint
    • Reduced exposure to future electricity price increases
    • Possible increased property value

    Can you or any DG owner be independent of your utility?

    Almost all DG system owners still depend on their local grid and utility. For example, a solar panel owner uses the grid to transmit electricity that is generated in excess of what he or she needs back to the utility at certain times of the day, and to obtain electricity from the utility at night or on cloudy days. Electric service actually consists of three distinct components: the electricity generation itself, transmission lines, and distribution (grid) services to get it where it needs to go. A DG system can reduce your need for utility-provided electricity, but does not reduce the need for transmission and distribution services.

    What is net metering?

    Net metering refers to the manner in which a utility calculates the quantity and value of electricity produced by a DG system. In the case of solar panels, the owner avoids buying some utility-provided power because the panels are generating a portion of the owner’s electricity needs. When the solar output is greater than the immediate needs of the house, the excess is sold back to the utility. Because the panels are generating electricity which is not being used in the house — the electricity meter calculates this as a credit. The details of net metering policies vary by state and utility, and can make a significant impact on the economics of a DG system investment.

    What do retail vs. wholesale electricity have to do with net metering?

    The retail electricity rate is the final rate you pay per unit of electricity and the one that is shown on your bill. It includes both the cost of generating the power and the cost it takes to get it to your home (transmission and distribution). While transmission and distribution costs generally do not change from month to month, generation costs vary depending on market conditions – much like the way we pay for gasoline. Most state net metering rules require utilities to credit consumer-generated electricity at the current retail electricity rate. For example, if you are a DG system owner who uses 10,000 kWh a year, and produces 10,000 kWh a year with a DG system, your electric bill would be 0. You would have paid little or nothing towards the utility’s cost of providing the means to receive electricity even though you benefitted from the equipment, and non-DG customers are required to make up the difference. Some utilities may account for transmission and distribution with a single fixed fee or would essentially pass along a rate that balances the utility’s cost of delivering services against their savings from your DG system.

    How will my DG system affect other consumers?

    While DG system owners may appear to be increasing other utility consumers’ costs through retail rate net metering, it’s important to note that DG systems also deliver several economic benefits to other consumers. We’ve listed some of these economic benefits in the table below. The value of these benefits vary significantly by geographic location, which is why net metering policies and rates vary. For example, the value of renewable generation is a combination of a DG system’s actual generation amount and timing (dictated in large part by regional weather patterns) as well as existing attributes of the local grid (such as the price of avoided generation).

    Is DG right for you?

    For most people, the choice to install a DG system will hinge on several factors:

    • Economic Factors — how does the cost of the system compare to the savings or revenues from the system? You should understand that even though the sun might be shining, if the distribution grid in your neighborhood goes out, your rooftop PV system may not work.
    • Personal Capabilities — do you have the financial resources and facility resources (physical space, an appropriate roof, etc.) to purchase and support the DG system you are considering?
    • Environmental Benefits — most consumer-oriented DG systems (like solar panels) offer global environmental benefits like reduced carbon emissions and air pollution.

    You think it might be nice to have solar panels on your roof. What must you consider?

    • First, determine if you are a good candidate for solar panels through a quick housing checklist. If you aren’t, some utilities offer “community solar”, which is the option of subscribing to electricity generated by solar panels located somewhere in your community. Check with your local utility.
    • Next, determine your costs.While solar panels involve minor ongoing costs, up-front capital requirements are significant. There are several options to reduce this initial investment:
    • Utility incentives
    • Potential state, local or IRS tax breaks
    • Home loan financing options
    • “No money down” leases (not available in all states)
  • Evaluate the type of contract structure available to you – the three main ones are lease, Power Purchase Agreement (PPA) or outright purchase. Each of these options offers varying upfront costs, potential maintenance agreements and ownership of benefits.
  • Finally, select your installer. You should get quotes from at least 3 companies. And be sure to ask for (and speak with) references. Your appropriate installation company will go over care and maintenance with you.
  • Web-based free solar assessments:

    Solar Rating Online:

    EnergyStar Renewable Energy Ready Home Solar Site Assessment Tool:

    PV Watts – National Renewable Energy Laboratory:

    National Council for Solar Growth:

    Solar Net Metering In 2023 (What To Know and How To Save)

    This guide has helped thousands of homeowners make the decision to go solar by illustrating how net metering programs can provide financial assistance. Let’s get started!

    Each product and or company featured here has been independently selected by the writer. You can learn more about our review methodology here. If you make a purchase using the links included, we may earn commission.

    Written by Leonardo David

    Leonardo David is an electromechanical engineer, MBA, energy consultant and technical writer. His energy-efficiency and solar consulting experience covers sectors including banking, textile manufacturing, plastics processing, pharmaceutics, education, food processing, fast food, real estate and retail. He has also been writing articles about energy and engineering topics since 2015. Learn About This Person

    Reviewed by Melissa Smith

    Melissa is an avid writer, scuba diver, backpacker and all-around outdoor enthusiast. She graduated from the University of Florida with degrees in journalism and sustainability studies. Before joining EcoWatch, Melissa worked as the managing editor of Scuba Diving magazine and the communications manager of The Ocean Agency, a nonprofit that’s featured in the Emmy award-winning documentary Chasing Coral. Learn About This Person

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    What Is Net Metering?

    Net energy metering (NEM) is a billing arrangement in which excess electricity production from photovoltaic (PV) solar panels is tracked by your electricity provider and subtracted from your monthly electric utility bill. When your solar system produces more kilowatt-hours of electricity than your home is consuming, the excess generation is fed back into the grid.

    For solar customers, the benefits of net metering include higher monthly savings and a shorter payback period. Without this benefit, you only save on power bills when using solar energy directly, and surplus generation is lost unless you store it in a solar battery.

    Utility companies also benefit, since the excess solar electricity can be supplied to other buildings on the same electric grid.

    Generally, you will see more home solar renewable energy systems in places with favorable net metering laws. With this benefit, going solar becomes an attractive investment even for properties with minimal daytime consumption. Residential customers can turn their roofs into miniature power plants during the day, and that generation is subtracted from their nighttime consumption.

    If a power grid relies on fossil fuels, net metering also increases the environmental benefits of solar power. Even if a building does not have an adequate area for rooftop solar panels, it can reduce its emissions by using the surplus clean energy from other properties.


    SunPower designs and installs industry-leading residential solar and storage solutions across all 50 states. With a storied history of innovation dating back to 1985, no other company on this list can match SunPower’s experience and expertise.

    SunPower earns its position as the top national installer on our list for a handful of reasons: It installs the most efficient solar technology on the residential market, offers the most expansive service area and backs its installations with a warranty well above the industry standard. All the while, SunPower pioneers sustainability efforts within the industry.

    If that weren’t enough, SunPower systems come packaged with products all manufactured in-house by its sister company, Maxeon. This means that your panels, solar cells, inverters, battery and EV chargers are designed to work together and are all covered under the same warranty.

    SunPower’s biggest downside? Its high-efficiency panels are considerably more expensive than most of its competitors’ products. However, its powerful panels are workhorses that make up for the initial cost with more backend production (think about this like spending more money for a car that gets more miles per gallon).

    Facts and Figures: SunPower

    EcoWatch Rating Better Business Bureau (BBB) Rating Year Founded Average Cost (-) Solar Services Brands of Solar Equipment Offered Warranty Coverage
    Solar Panels, Solar Batteries, EV Chargers, System Monitoring
    SunPower Panels
    25-year all-inclusive warranty

    Blue Raven Solar

    We like Blue Raven Solar because it understands that, for most homeowners, the cost of solar presents the biggest barrier to entry.

    For that reason, Blue Raven Solar developed an innovative solar financing plan that offers in-house, flexible, zero-money-down options. The results speak for themselves, as Blue Raven Solar is now one of the fastest-growing solar companies in the nation and was recently acquired by SunPower. Its BluePower Plus plan (exclusive to Blue Raven) mimics the flexible structure of a lease while still providing the greatest benefits of owning your system.

    Eligible homeowners enjoy 18 months of solar power before having to pay their first bill. When coupled with the federal solar investment tax credit (ITC), the initial energy savings can offset more than a third of the overall cost of a system before requiring a dollar down.

    In contrast, other installers can only offer similar financing through solar leases, PPAs or third-party providers (such as Mosaic or Sunlight). Third-party loan providers can complicate the process, while opting for a loan or PPA will disqualify you from some of solar’s biggest benefits (additional property value, federal solar tax credit and local solar incentives).

    Facts and Figures: Blue Raven Solar

    EcoWatch Rating Better Business Bureau (BBB) Rating Year Founded Average Cost (-) Solar Services Brands of Solar Equipment Offered Warranty Coverage
    Solar Panels, System Monitoring
    Trina Solar, Canadian Solar, SolarEdge, Silfab, SunPower
    25-year manufacturer warranty; 10-year workmanship warranty, 2-year production guarantee

    ADT Solar

    ADT Solar sets the industry standard for warranty coverage by including a multifaceted guarantee, making it one of the top installers for homeowners who want added peace of mind.

    Its warranty coverage includes all of the following for 25 years:

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    • Power Production Guarantee: Also known as a performance guarantee, this ensures your solar system will produce the amount of electricity that’s outlined in your proposal, or ADT will write you a check for the difference.
    • Labor Guarantee: This covers any issues with the installation of your system and is also known as a workmanship warranty.
    • Panel Module Performance Guarantee: This is what ADT Solar refers to the manufacturer warranty as, and it ensures that any manufacturing defects are repaired or your ineffective panels replaced.
    • Enphase Microinverters Guarantee: This backs the performance of your inverters.

    Though in recent years other solar companies have started to offer similar guarantees, ADT Solar has been at it since 2008, performing over 30,000 installations across the country.

    Facts and Figures: ADT Solar

    EcoWatch Rating Better Business Bureau (BBB) Rating Year Founded Average Cost (-) Solar Services Brands of Solar Equipment Offered Warranty Coverage
    Solar Panels, Solar Batteries, EV Chargers, Energy-Efficiency Upgrades
    Silfab, Panasonic and others depending on location
    25-year all-inclusive warranty

    How Does Net Metering Work?

    There are two general ways net metering programs work:

    • The excess energy produced by your solar panels is measured by your utility company, and a bill credit is posted to your account that can be applied to future power bills.
    • The excess energy produced by your solar panels is measured by your home’s electricity meter. Modern power meters can measure electricity flow in both directions, so they tick up when you pull from the grid at night and count down when your solar panels are producing an excess amount of electricity.

    In either scenario, at the end of the billing period, you will only pay for your net consumption — the difference between total consumption and generation. This is where the term “net metering” comes from.

    How Net Metering Affects Your Electric Bill

    Net metering makes solar power generation systems more valuable for homeowners, as you can get credit for any extra energy production to your utility company. However, it’s important to understand how charges and credits are managed:

    • You can earn credits for your surplus energy use, but utility companies will not cut you a check for the power you provide. Instead, they will subtract the credits from your power bills.
    • If your net metering credit during the billing cycle is higher than your consumption, the difference is rolled over to the next month.
    • Some power companies will roll over your credit indefinitely, but many have a yearly expiration date that resets your credit balance.

    All of this in mind, it is possible to reduce your annual electricity cost to zero through time-of-use. You can accumulate credit with surplus generation during the sunny summer months, and use it during winter when solar generation decreases. You will achieve the best results when your solar energy system has just the right capacity to cover your annual home consumption.

    Oversizing your solar array is not recommended, as you will simply accumulate a large unused credit each year. In other words, you cannot overproduce and charge your power company each month. Some power companies will let you pick the expiration date of your annual net metering credits.

    If you have this option, it’s wise to set the date after winter has ended. This way, you can use all the renewable energy credits you accumulated during summer.

    If you’re ready to see how much you can save with solar energy, connect with one of these trusted EcoWatch providers noted below.

    What Does Behind-the-Meter Mean?

    When researching solar panels, you’re bound to come across some industry-specific terms that may not make sense right away. There can be a lot of jargon in the solar energy world, after all, and it isn’t always easy to keep it all straight.

    “Behind-the-meter” is one such term. “Behind-the-meter” refers to the position of an energy system in relation to an electricity meter. But what does that mean for you and your solar energy system? Let’s find out.

    Behind-the-Meter vs Front-of-Meter

    The term “behind-the-meter” has a sister phrase, “front-of-meter”, and the two are often used together. But before we can explain what they mean and how they’re different, we need to define the term “meter”.

    What Is An Electricity Meter?

    An electricity meter is a device that measures the amount of energy a home or building pulls from the electric grid. Almost all residential homes and commercial buildings have an electricity meter attached to them. Your utility, like National Grid or Eversource, collects data from your meter to see how much electricity you’ve used, and therefore, how much money you owe them.

    Behind-the-Meter: What It Means

    The term “behind-the-meter” refers to energy production and storage systems that directly supply homes and buildings with electricity. Residential and commercial solar panels are considered to be behind-the-meter, as are residential and commercial solar batteries—the energy that is produced and/or stored by these systems is separate from the grid and does not need to be counted by a meter before being used, so they are positioned behind the meter.

    Behind-the-meter, however, is not the same as “off-grid”. Most behind-the-meter solar energy systems are still grid-tied, which means they maintain a connection to the electrical grid. The energy the solar PV systems provide do not pass through an electricity meter before it is used by the home or business, but, when the panels are not in use (when there is no sunlight), energy from the grid is sent to the home or business, and that energy must pass through a meter first so that it can be accounted for by the utility.

    Front-of-Meter: What It Means

    “Front-of-meter” systems provide energy to off-site locations (like a home or business), and that energy needs to pass through a meter before it can be used. You can think of front-of-meter systems as those that are part of the utility. Energy generation and storage systems that feed the grid, as well as the power lines used to transport that energy, are considered to be front-of-meter because the energy they provide must pass through a meter before it can be used—they are positioned in front of the meter. Any energy that is delivered to your home or business from the electric grid comes from a front-of-meter system.

    Behind-the-Meter and Net Metering

    Net metering is a process through which homeowners and businesses that have solar panels can send excess energy produced by their system back to the grid in return for a credit. That credit can then be used to pay for energy they may need to pull from the grid when their solar panels are not producing electricity.

    In order to participate in net metering in Massachusetts, you need to have a bi-directional meter installed at your home or business. This bi-directional meter is installed in place of a traditional electricity meter and used to measure the amount of electricity you pull from the grid as well as the amount you send back or ‘tick backwards’. Solar energy systems that are used for net metering remain behind-the-meter.

    Sometimes, an additional meter may be installed to measure the amount of electricity your solar panels produce overall. Incentive programs like the Solar Massachusetts Renewable Target (Smart) program, require this information. To receive your Smart incentive payment for your behind the meter system, the Smart program needs to know how much energy your solar panels produce each month so that they can calculate your monthly incentive payment correctly.

    Stay Savvy About Solar Energy With Boston Solar—the #1 Mass-Based Solar Company

    We know homeowners want to do their research on solar energy before going solar! Boston Solar is here to help and can break down the jargon and help you understand the different types of solar energy and battery storage systems so that you can make confident decisions about your investment in solar energy.

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    We can also talk to you about the different solar tax credits and incentives available to Massachusetts residents, net metering credits, Smart incentives, and the Federal Solar Tax Credit, and help you qualify for as many as possible.

    Boston Solar is a 100% locally owned and operated company, and our customers are our top priority. We’re here to help make your transition to solar energy as seamless and straightforward as possible.

    Interested in solar panels for your Massachusetts home or business? Schedule a free consultation with Boston Solar! Call 617-858-1645 or contact us here.

    What is Solar Net Metering: Working, Installation How To Apply

    A solar metering energy system is a system that uses the electrical grid to store the excess electricity produced by domestic or commercial solar panels. The electrical meter installed inside a house or any other commercial building records the power consumption. Thus, people only need to pay for the net energy consumed by them.

    To use this system, people need to have proper solar metering energy set up consisting of a solar panel, solar inverter, bidirectional meter, and an electricity connection.

    Since there is an absence of a battery for power storage, an electricity connection is essential to transfer the unused energy to the grid. Therefore, this system is an economical option for people while limiting environmental pollution.

    Functions of a Metering Energy System

    A rooftop solar panel facilitates the generation of extra electricity than the requirement of people. However, due to the absence of a proper storage system, the electricity produced by solar panels gets wasted. The solar net metering system solves this problem by transferring the extra power to the electricity grid.

    All the net metering solar power systems are connected to the electricity grid. When the solar metre produces an extra quantity of electricity, the bidirectional electric meter rotates in the reverse direction to measure the transfer of the electric unit to the grid.

    The transferred electricity is credited to your bill. This means that when you need to use the electricity afterward, you only need to pay for the extra unit of electricity you consume. In addition, the bidirectional electric meter keeps a record of all the power exchanges. Therefore, you don’t need to maintain power utility on a daily basis.

    Benefits of Metering Energy and Net Metering system

    Net metering is an excellent way of promoting sustainable energy utilisation. It offers the following benefits to users and the environment:

    • It prevents the requirement of storage battery: Solar panel owners don’t need to invest in batteries to store the extra power. The metering energy inverter easily transfers excess electric power to the grid. Whenever people need electricity, they can do so without paying an additional charge.
    • It generates financial credit: Metering energy offers a great way of generating a passive income for people who have a large solar panel setup. This means that by generating multiple units of electricity, people can get either credit for further use or revenue from the state government or the electric department.
    • It has a low maintenance cost: Net metering is a cost-effective option for using electric power. In addition, the transfer of excess power to the electric grid reduces the maintenance charge compared to a non-grid system.

    Elaborated Process to Install Net Metering system in India

    The procedure of net metering installation for metering energy in India differs in each state as different power distribution companies and electric departments have their own policies. However, the standard process involves the following steps:

    • Applicants need to send an application to the SDO to seek permission to install a rooftop solar panel.
    • Applicants need to collect the approval receipt from the sub-divisional officer.
    • SDO completes the site verification within three days after application and approval.
    • After the site inspection, SDO approves within 15 days from application submission.
    • Consumer and SDO sign a net metering agreement within three days of filling up the net metering form.
    • After installing the solar system, consumers shall submit a solar system certificate, property papers, installation certificate, and fees.
    • In the end, a JE visits the site to inspect the solar panel installation. If all the rules are met, the JE gives permission to install a metering energy system.

    Net Metering Approval Checklist

    Applicants need to follow the given checklist to concisely monitor their solar metering energy application:


    • Submit duly signed application.
    • Provide roof right and occupancy proof.
    • Applicant’s signature ID proof.
    • Copy of recently paid electric bill.
    • Applicants who are tenants or co-owner of property must submit the NOC of the owner or co-owners.
    • Undertaking that is signed by a registered customer and attested by a notary public.
    • Applicant’s photograph.


    • Submit a registration form that is duly attested by the registered consumer.
    • Subsidy sanction request letter.
    • EPC agreement for CAPEX and PPA for RESCO.
    • Receiving letter for metering energy application.
    • Colored photo of the site with clear stamping of date and time before solar panel installation.
    • Project report as per the Annexure-D format of tender document.
    • Single lined diagram of the solar plant.
    • System certification for the PV module inverters.
    • Specifications of inverter and solar PV module.
    • Non-judicial stamp paper agreement for metering energy connection.

    Cost of Net Metering Installation

    The cost of metering energy metre installation varies in different states of India. However, the general guidelines of DERC suggest that an applicant needs to pay the following charges to install net metering systems:

    • Application charge: Rs. 500
    • Registration charge: It varies according to the capacity of the solar panel.

    The following table broadly demonstrates charges for each solar panel capacity for metering energy:

    Capacity (kWp) Charge (Rs.)
    1 to 10 1,000
    10 to 50 3,000
    50 to 100 6,000
    100 to 300 9,000
    300 to 500 12,000
    Above 500 15,000

    The following table provides the information for meter charges paid by the customers:

    Type of net meter Charge (in Rs)
    HT net meter 10,400
    LTCT net meter 9,200
    Three-phase net meter 7,800
    Single-phase net meter 1,500

    Metering Energy Stats and Policy in the Various States

    India has achieved 40 gigawatts of rooftop solar energy generation by the financial year 2022. Earlier, the metering energy for rooftop solar panels was set at one megawatt, which was cut down to nearly 10 KW in 2020.

    #1. Metering Energy stats in Punjab

    Punjab stands at the tenth position for having the largest solar panel set up in India. In 2018 Punjab’s solar capacity was estimated at around 845 MW.

    In the present scenario, the state gets more than 6% of its total electricity from solar net metering, which will rise in the coming future.

    #2. Metering Energy stats in Haryana

    The Haryana government provides financial assistance to applicants installing solar panels for net metering.

    For the applicant’s convenience, the state government allows people to complete the registration process through online mode. The distribution licensee shall provide metering energy facilities to qualified consumers in its region of supply on a non-discriminatory and first-come, first-served basis.

    #3. Metering Energy stats in Maharashtra

    Maharashtra has the 8th largest solar panel set up in the country. In the 2018 financial year, Maharashtra’s fourth-quarter solar power generation from metering energy was around 1,311 MW.

    The Maharashtra government uses a metering energy system to keep track of electricity generated in the state through solar panels.

    #4. Metering Energy stats in Delhi

    Delhi aims to produce 2,000 MW of power through metering energy until 2025. Although the government has mandated the installation of solar panels in all the government buildings, it still lags in achieving its target.

    #5. Metering Energy stats in Karnataka

    Karnataka state government has proposed to generate over 500 kW of power through metering energy. In addition, KERC has suggested a tariff rate of Rs. 3.82 per kWh for domestic solar installation, which has a capacity between 1 to 10 KW.

    For larger solar panels set up of capacity 1 KW to 2 MW, the tariff rate is 2.84 per kWh.


    A Net metering system is the best solar power generation system because it lets you use the required unit of electricity and exchange the excess power for revenue or credit.

    People don’t need to set up and maintain an electricity storage unit because the bidirectional electric meter conveniently transfers unused energy to the electric grid.

    over, this system promotes pollution-free power generation, which reduces harsh effects on the environment.


    Can I use power from the net metering system during a power cut?

    No, this system only allows you to use electricity when there is a power supply in your area. Since no battery or other storage device is involved, using electric current during a power cut becomes impossible.

    Is it possible to sell surplus electricity generated domestically?

    You can easily sell any surplus unit of electricity to the government or power distribution company by connecting your solar power generation system to the state’s electricity grid.

    Can I use a general-purpose inverter for net metering?

    No, rather it is crucial to use a solar inverter. The specific design of this inverter facilitates the convenient conversion of direct current obtained from solar panels into alternating current, which is then either used for household purposes or transferred to the grid.

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