September 19, 2023

Net Metering & What It Means To You

What makes installing solar panels such a great way to save money? The answer to that is simple: net metering. In fact, the best states for installing solar aren’t necessarily the ones that get the most sunshine - instead, it’s the ones with the best net metering policies. Let’s take a closer look at what net metering is.


Net Metering Definition: Net metering (also known as net energy metering or NEM) is the foundational solar policy and incentive on which the entire residential solar industry is built. Simply put, net metering is a way of using the electrical grid to store energy produced by your solar panel system for use at a later time. 

Why Does Net Metering Exist?

Net metering is designed for two primary purposes: first, to encourage the greater adoption of solar throughout the country; and second, because utilities–and the electricity grid as a whole–can benefit from the influx of low- to no-cost solar energy onto the grid. Solar energy can help balance the cost of purchasing electricity from other resources, especially during summer months when electricity is often the most expensive on the hottest–and sunniest!–days of the year. 

How Does It Work?

If you think about it, your home doesn’t use that much electricity during the day, which is when your solar panels are the most productive. From 7 AM to 5 PM, you’re at work, the kids are probably at school, not much is going on in the house - so there isn’t a whole lot of electricity being used. So, your solar panels will be making a lot of electricity at a time you don’t really need it. Without net metering, all of that extra solar energy your panels produced would be sent to the grid, and you wouldn’t get anything for it! On the other hand, with net metering, your utility company will pay you for that solar electricity you send to the grid. Usually, utilities pay you back by applying an energy credit to your electric bill for each kilowatt-hour (kWh) of solar power you’ve sent to the grid. 

Those net metering credits can then be used to offset any energy you take from the grid when your solar panels aren’t producing electricity - like after the sun goes down. This allows you to get the full economic value of all of the solar energy your panels produce.

In other words, you don’t have to pay for all of the electricity you use from the grid because your net metering credits will cancel out your future grid usage, which is what makes net metering so valuable! 


If you are interested in solar or want Net Metering to start working for you then feel free to contact us here at Lifestyle Solar.



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