Net Metering At Legislative Crossroads

Tue, 2012-07-10 12:10

Net metering is an important component of most U.S. plans to meet ambitious renewable energy goals. More than 40 states currently have policies in place. What is net metering? What are the benefits and challenges of such a policy? In a multi-part blog series, I will take a look at how net metering is boosting renewable energy and what it is about the policy that makes it a hotly contested, divisive issue in the U.S. As many states inch closer to reaching their net metering caps, legislators, utilities, and solar advocates are at a crossroads in determining how to move forward.

What is Net Metering?

Net metering is a policy that provides incentives to consumers who invest in small, on-site renewable energy sources, most commonly rooftop solar. Think of it as cell phone rollover Solar Net Metering Diagramminutes for electricity, allowing homeowners to get credit for the electricity they produce but do not use. Through installation of a special meter, a homeowner can use the power generated by solar panels to offset energy consumption. When more energy is generated than is being used by the household, the meter runs backwards. The excess electricity is exported to the grid and the customer gets credit for the unused energy, up to the point where their bill zeros out.

Who Benefits?

Consumers: Net metering creates economic incentives that make solar power a viable option for more customers.

Economy: As more customers look to solar as a way to save on rising utility bills, there is a growing demand for solar professionals. The solar industry has been successful at generating jobs due to the diversity of positions available.

Utilities: Homeowners are typically putting energy back onto the grid during the day, when the sun is shining. At night, they use energy from the grid, applying credits generated during the day. Solar producers are giving utilities energy when it is most expensive for them and using energy when it is cheapest, helping utilities to efficiently meet demand at peak times. 

Environment: Net metering facilitates power generation that reduces local pollution and greenhouse gas emissions, while eliminating the space requirements that can be a drawback for larger scale renewable energy developments. Net metering also eliminates the need for additional storage space for battery backup systems.

The Debate

Seems simple, right? Consumers save money, utilities can meet demand more efficiently, states get closer to achieving renewable energy goals, and dependence on fossil fuels is reduced. So, what’s the problem? Why are states having difficulty legislating to increase caps on net metering? In a subsequent blog post, I will examine the battle over net metering, which is being closely watched in California, as outcomes are expected to influence other states. Hint: Think fairness, equality, and money!

If you are interested in learning more about solar energy, including installation, sales, and preparing for solar certification exams, check out Everblue’s Solar Training Courses. There are several training packages available to start advancing your career in renewable energy.

By Amy Malloy

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