If you’re a solar energy user, we’re sure you already come across with the word “Net Metering”.

…but what does net metering really means? How does it work? Is there any benefit on it?

In this article, we will give you the simplest way to understand net metering, its benefits and how does it work.

Let’s go on.


So what is net metering?


Net metering explained refers to a billing system where owners of solar energy systems get credits by providing surplus power to the grid.

This is excess energy that is generated from your home’s solar power system that is in excess of what your homes electrical appliances were using at the time this solar energy was generated.


When the solar energy system produces more than required energy, the surplus goes to the grid, and in this case, the meter runs backward, giving the system’s owner credits for the units supplied.


So how does it work?


A net meter works in tracking the exchange of energy between a solar energy system and the grid.

Your home’s solar energy system will generate the most power during the day. This is also when your home typically uses the least amount of power.

The excess created during the day is then transferred back to the power grid so it can be shared by other consumers. You receive a credit for the power that you share.

In fact,

Your power meter will go in reverse to reflect your contribution.

During the evening, your solar system creates no power and you typically consume a significant amount of power. At this time you will need to draw energy from the power grid.

Your power meter moves forward again. At the end of the month, you will receive a credit if you contribute more to the grid than you use.

This is more likely to be the case in warmer months when longer days and higher solar insulation levels mean your solar power system is producing more power.


Are there any benefits of net metering?

Of course!

There are two main benefits to net metering.

The first one is a financial benefit to the owner of the solar energy home.

You can greatly reduce your monthly power bills resulting in thousands of dollars in savings over the life of your solar energy system.

This means that your new solar panels can quickly pay for themselves.

The second benefit is to the power grid itself.

When solar energy homeowners contribute excess energy to the grid, they significantly reduce the stress that is placed on the system.

This allows the power grid to function smoothly and efficiently for longer periods of time. As a result, the equipment lasts longer and the cost of maintaining the grid is reduced.

So net metering is better than going off the grid?

To tell you honestly,

The decision to go completely off the grid is a personal matter, however, there are benefits to remaining on the power grid.

One of these benefits is that net metering allows you to get economic value for the power you generate in excess of your immediate needs without the need to invest in a solar battery.

First of all, net metering allows you to contribute energy to your community by transferring excess power back to the grid.

This community approach to energy creation will only help to improve our energy sustainability.

Secondly, using the grid to supplement your solar energy system places less stress on your power system. The power grid can quickly step in when your solar system cannot generate the energy you need at night and during the winter months.


How about gross metering?

A gross meter measures the import and export of power separately. In this case, you provide all the energy your solar energy system produces to the grid while using power from the grid at the same time. At the end of the month, while you pay for the power you use, you receive compensation for the power you pump into the grid.

So which one’s better?


Policies regarding providing power to the grid, vary from one state to another.

New South Wales and the Australian Capital Territory offer more lucrative prices to those who opt-in for the gross feed-in tariff rate.

On the other hand,

If you live in Victoria, Queensland, or South Australia and have nominal requirements for power, you can benefit by going the net feed-in tariff rate way.

Bear in mind that switching from net metering to gross metering, or the other way around, is not particularly easy, and you might have to spend some money to accomplish this.


What are other incentives besides net metering available for solar systems?

The benefits of solar energy span many facets of our society.

First, it greatly reduces our environmental footprint. Renewable energy sources, such as solar, place less stress on our already fragile ecosystem.

Another one is that,

There are financial benefits to consumers and energy companies alike. Consumers can save significantly on monthly power bills, while the power companies can benefit from the shared energy that solar homeowners and net metering provides.

This symbiotic relationship will allow the existing power grid to function more efficiently and at a lower cost.