Net Metering Mechanism

Net metering is an electricity policy which allows utility customers to offset some or all of their electricity use with self produced electricity from RES-E systems. Net metering works by utilizing a meter that is able to spin and record energy flow in both directions. The meter spins forward when a customer is drawing power from the utility grid (i.e. using more energy than they are producing) and spins backward when energy is being sent back to the grid (i.e. using less energy than they are producing). At the end of a given month the customer is billed only for the net electricity used. Net metering works only for grid connected systems and what makes it so beneficial besides offsetting a home’s energy consumption with a RES-E system is that excess energy sent to the utility can be sold back at retail price. If more energy is produced than consumed producers receive benefit for this positive balance such as renewable energy credits (REC) which is credited on the customer’s account toward the next billing cycle.