What Is Net Metering?

Solar panel systems are designed to provide cleaner and more affordable energy to homeowners. So what are ways homeowners can save even more? Net metering is one of the most appealing aspects of going solar in California. Why? Because net metering allows homeowners to receive bill credits back on any additional electricity produced by their solar panels. Essentially, any energy their panels produce that isn’t used up by their household demands is able to be funneled back to them as a credit for low production times or surplus.

There have been some slight changes to the original net metering policy for California. The original net metering allowed a bill credit for one kilowatt-hour (kWh) of electricity for every kWh your solar panels produced and fed to your local grid. Any excess amount would be applied to the times when you had to draw upon the grid instead of the solar power grid.

With net metering 2.0, the core of the original policy remains the same – essentially credits are still equivalent. The new policy also helps prevent grid access charges, capacity fees, and other charges that don’t favor homeowners. However, the three new features – time-of-use rates, interconnection fees, and non-bypassable charges – do add some expense for homeowners. California Solar Energy Industries Association estimates expenses will increase by around $10 a month for the average homeowner.

How Net Metering Can Still Save You Money

Over the lifetime of a solar system, a homeowner could save thousands of dollars in electricity expenses through net metering. If your solar panels are able to produce a significant enough amount, you could end up having the majority of your bill covered, if not entirely covered.

For example, say you have to draw 800 kWh of electricity from the grid throughout the month of November during the times when your solar panels aren’t producing electricity (on those cloudier days). If you are able to export 600 kWh of energy throughout the course of the same month, you could cover a majority of your bill, only being charged for the net difference of 200 kWh. Again, some months your solar panels may be able to produce an equal amount to completely cover your usage needs, especially during those sunnier months.

Understanding Time-of-Use Rates

So what are time-of-use rates and how will they impact you? Under net metering 2.0, time-of-use billing is used to charge customers more for peak hour usage and less for off times. Under the solar billing cycle, you could greatly benefit because your solar system will typically generate more power during peak hours (or more expensive windows) depending on your area. That means you can avoid the higher charges and have more credits stored up for when you need to use them during low production hours (ideally off-peak times so they go further).

Unfortunately, this could also mean that if you use a lot of energy in the early evening and your panels don’t produce much energy during this time of day, you could be paying more than you previously did. The best bet? Review your net metering time-of-use rates and adjust to the peak and off-peak hours to ensure you maximize your savings.

More questions about net metering? Let the Semper Solaris experts provide insight. Call us today to speak to a solar professional in San Diego.