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Net metering: Will the utility buy back excess from my solar panels?

Many people ask us if they should invest in installing more solar panels than what they need to eliminate their electric bill. In order to understand this question, we must first talk about net-metering. Net-metering is the law that allows homeowners and businesses to produce their own electricity while connected to the utility grid. It states that utilities must give the consumer credit for all the electricity they produce, but only as much as they consume. In other words, they are no required to give you any credit whatsoever if you produce more than what you use. Some utilities will, however, give you a wholesale rate for any electricity you produce beyond your annual usage. Although that may sound like a good incentive to overproduce, the economics of installing a system larger than what you need in order to receive wholesale rate for your electricity are not there.

A good summary of PA’s net metering law can be found at http://programs.dsireusa.org/system/program/detail/65.

The actual PA state code for net metering can be found at; http://www.pacode.com/secure/data/052/chapter75/subchapBtoc.html

According to this code, they are required to provide you with full retail rate (includes both generation and distribution charges- anything that is metered) for any excess that you produce. You will get credit for this excess in terms of a negative meter reading, every time you instantaneously produce more than what you use. They will not write you a check every time your meter runs backward, but will continue to read your meter just like they do before installation. On a monthly basis, if you produce more than what you use, they will not write you a check, but rather roll the negative amount over to subsequent months. If your system is sized to eliminate your bill on an average annual basis. Then you will likely produce 50% more in the summer than the winter, and depending on your usage during those months, you may accumulate sizable credits to be used up later.

It will take significantly longer to see a return on investment for the portion of a solar array that produces more than your annual usage. The only time we typically recommend doing this, is if you know you will be increasing your electric consumption in the near future.

Call us today! we will be happy to perform a detailed solar evaluation for your property that will include an economic assesment for any system of your choice.

#netmetering #solareconomics

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