Net metering benefits you with reduced electricity bill by cutting down the amount of electricity from the distribution company. You receive credits for the electricity that you generated but didn’t use. On top of getting a monetary benefit, you get the peace of mind that you are positively contributing towards the environment with renewable energy.
It has been available to customers since the 1980s. Moving forward to 2008, when a legislation got enforced then
• The size of net metering facilities was enhanced i.e. the capacity allowed to customers to use renewable resources to create energy increased from 60kW to 2MW.
• The value of the credits given for generating electricity through these facilities got increased from wholesale rate to almost retail rate.
• Followed by this, net metering customers were allowed to allocate net metering credits.
Moving on, additional legislations were passed from 2010 to 2016 which increased the overall amount of allowed net metering projects.
In 2016, the legislation made changes in the net metering laws thereby:
• Instructing the distribution companies to calculate market net metering credits after a certain time period.
• Updating the limits of net metering capacity.
• Outlining the process so that the distribution companies submit a proposal whenever they want to add a per month reliability contribution to electricity bills for the customers who are receiving net metering credits.
First of all, you must be a customer of a specific electric distribution company.
Secondly, you must meet all the requirements of your electric distribution company before you begin interconnecting your generating facility.
Thirdly, if on a single phase circuit your net metering facility is larger than 10kW or on a three phase it’s larger than 25kW then you must receive a cap allocation for your facility.
Under the net metering regulation, you don’t need to necessarily buy and/or own the generating facilities. They can be financed and/or owned by someone else other than you (the host customer).
You get billed on the net consumption of electricity.
i.e. your Net Consumption = (total electricity consumed) – (total electricity generated).
If net consumption is positive, you will pay the bill to the distribution company. If negative, you receive money for that billing period.
In simple words, what you get billed for totally depends on the amount of electricity produced. If you use more electricity than it is generated on the site then you owe the distribution company money. On the other hand if you use less electricity than you produce then you earn a monetary credit.
Imagine if you have solar panels installed on the rooftop of your home. At night when the panels aren’t generating electricity, your retail meter spins forward because you are consuming electricity for may be your computer, refrigerator or any other power appliance. During the day when the panels generate electricity, your meter spins in reverse. In this case, the excess electricity produced is sent to the electric grid.
At the time of paying the bill, you only pay for the net consumption.
If you are producing more electricity than you use then the distribution company will calculate the monetary amount for the excess electricity you sent to the grid. You will receive credit for it and it will also appear on your bill and doesn’t expire.
It takes 12 months from the date you submit NEM application to the date of proposed contract with TNB/SESB. In case your application is refused the quota allocated is offered back to other potential NEM applicants.
You need 3 types of meter for NEM. Below are the details.
1. TNB/SESB’s bi-directional meter – This meter comes with import-export feature and is primarily needed to record the amount of electricity you will produce, consume or export
2. Check meter – This meter’s purpose is to measure the amount of energy exported (if applicable). It’s measurement is equivalent to or same as the standards of the consumer meter installed by TNB/SESB at your premises
3. PV meter/data logger/inverter – This type of meter (along with monitoring feature) records the total amount of electricity your PV system generates.
200 MW quota will be offered on 1st Nov 2016 as allocated for 2016 and 2017. For 2018, quota release is scheduled (yet to be approved) for Ist July 2017. This will be released with prior announcement.
11. How do I know I am eligible to participate in NEM?
Your eligibility to participate in NEM depends on your electricity bill. This precisely means if you are a registered customer of TNB/SESB, you are eligible. All you have to do is ensure that your name/ company name appears in the TNB/SESB bill.
You don’t need to apply for NEM in such a scenario. However, if your PV system’s capacity is above 72kWp, you’d require a generation license (private) from ST which should comply with the relevant rules under the Electricity Supply Act (ESA).
The contracts becomes effective from the same day both parties sign it. And it remains in effect unless either party terminates it or the main electricity contract gets cancelled.
There’s no cap on the number of customers who can participate in net metering scheme.
Yes, you will need a bi-directional supply meter.