Imagine that you just installed solar panel on your roof. Your panels are absorbing the energy from the sun, you feel good that you’re helping to create a greener world. There’s an interesting twist to the story – what if your system produces more electricity than you use? Enter net energy metering (NEM), an ingenious procedure that turns your excess solar power into credit, effectively dialing down your utility meter.
Net energy metering is a billing method that allows people who generate their electricity to sell surplus energy back into the grid. Consider it your energy bank. If you have more energy than needed, you can deposit it. If your system does not meet your energy needs you can withdraw your deposit.
Is it possible to have your cake AND eat it? That’s because, in a way, it is. What are the financial and environmental implications of this process? The first thing to note is that feeding excess energy back into the grid by using NEM will reduce your electric bills. During a month of sunshine, your panels may produce more juice that you can drink. This excess energy is not wasted. Instead, it’s sent to the power grid. It earns you credits which can be used for when your panels perform less efficiently, like in cloudy conditions or overnight.
NEM promotes more than personal savings. It does this by reducing our dependence on fossil fuel power plants that are bad for Mother Nature because of their emissions. NEM users do not only save money, they’re also environmental heroes without a cape!
But it’s still not all rainbows and sunshine. Policies governing net energy meters can vary greatly, creating a patchwork that can confuse solar users. NEM rules can be different in each state and these changes are often influenced by political or energy policies. Staying informed about local laws governing energy is just as important as watering plants.
Are you planning to switch over to net metering in the near future? This is a piece of advice: check the specifics of net metering in your area. Some utilities limit the amount solar energy that they will accept from residential systems. Incentives can change, and so can rates for credits given to grid surplus energy.
A second problem could be the cost of initial installation. Solar panels aren’t cheap. While prices have decreased over time, the upfront cost is still high. This investment, when you consider the rising costs of nonrenewable sources of energy, could prove to be the smarter choice in the long term.