With the government aiming to switch to renewable energy to reduce conventional sources dependency, solar energy proves to be the most prominent and reliable source of energy due to the series of economic benefits it grants.
Well, why just be a consumer when you can be a producer as well!
Right, solar energy installation at your place can make you a prosumer.
Solar net metering consents consumers to produce, borrow and sell electricity to the connected utility grid. I hope our previous article on solar net metering gave you enough idea about what solar net metering is and what is the difference between gross metering and solar net metering.
Net metering is a billing mechanism that allows you to pay for your electricity production. But how does net metering work? What are the scenarios in which I can get paid?
In this article, we have tried to answer your question and provide you with insights related to solar net metering.
How does solar net metering work?
The solar net meter is a bidirectional meter that allows the import and export of energy from the utility grid-connected.
1) During Day/Sunny Day: During sunny days, solar panels work at their optimum condition and generate energy to its full capacity. The generated energy is supplied to the load connected through the inverter and the surplus energy(during daytime generally the energy requirement at your home is less) is exported to the grid-connected through the net meter. The amount of energy supplied is recorded by the net meter.
The energy supplied to the grid can be imported during the non-sunny hours, and the difference between the energy supplied and borrowed is calculated at the end of the billing cycle.
2) During Night: The solar panels are not capable of generating energy during night hours. To support during this time slot energy is imported from the utility grid-connected.
3) During Cloudy Weather: During the cloudy weather or rainy season, solar panels operate below their optimum level. The extra energy required during this time interval is imported from the utility grid-connected through net metering. The amount of energy imported is recorded and added during the billing period.
4) During Power Outages: In case of power failure, the solar net meter stops working as a safety precaution. During this event, if power is supplied from the solar panel to the utility grid-connected the person working on the maintenance of the grid can be endangered.
For instance, a grid-connected solar rooftop system installed generates 700 units of electricity per month, now let us understand the billing scenario considering the following two cases:
Energy consumption: 600 units
Solar energy generation: 700 units
Difference: 700-600 = 100 units
These 100 units are carried forward into the next month, the estimated net electricity bill for this month is zero.
Energy consumption: 600 units
Solar energy generation: 800 units
Difference: 800-600 = 200 units
Carry forwarded units = 100 units
Energy bill = (Difference of energy units – carry forwarded units)
= 200 – 100
= 100 units
So, for this month the consumer needs to pay only for this extra 100 units consumed.
Suppose for your location the set tariff rate is Rs 5 per unit,
100 * 5= 500 Rs.
So the estimated billing amount for this month is Rs 500.
Just an anxious fact: Without solar energy installation, the electricity bill would have been 800*5 = 4000 Rs
(I know it is too much, especially for residential consumers)
Going for solar is a vital alternative to cut your ever-increasing electricity bills without compromising your comfort!
Amended national policy on net metering – 2021
The Ministry of Power(MoP) under the “Right of Consumer” on 31st December 2020 issued a few clauses on the “solar rooftop project”. One interpretation was regarding the net metering policy which described that net metering is allowed only for capacity up to 10kW and gross metering above it.
The net metering restrictions imposed by the government, restricts the high load investors to switch towards solar.
This imposed rule impedes the pace of capacity addition(Government of India aims to install renewable energy of 175GW by 2022 and 450 GW by the year 2030) of rooftop solar in the country by disincentivizing industrial and commercial consumers from installing the solar rooftop system in their premises. Due to this changed metering structure, a drop in the growth of rooftop solar installation was noted and to avoid this, the Ministry of Power released a new notification on 28th June 2021.
According to the latest amendment rule released in June 2021 by the ministry of power under the “Right of Consumers” provisions of the electricity right act 2003 regarding the solar rooftop projects, net metering can be permitted for plant capacity to 500kW or up to the sanctioned load (whichever is low) as per the state policy. The consumers can earn nearly Rs 7 per unit (kWh) (It varies with state policy) by selling the surplus generated power through net metering from their installed rooftop solar system.
Advantage of solar net metering:
- Reduced electricity bill
- Environmental friendly
- No battery backup required
Disadvantage of solar net metering:
The major drawback faced in solar net metering is that it is completely grid-dependent, the system gets halted in case of power failure.
- Does the utility grid store the energy supplied by the solar panel installer?
No, the amount of surplus power sent to the utility grid is used by other consumers, but as the energy is exported through net metering the number of units of energy supplied is recorded and credited into the billing account of the consumer.
- Do we need to inform the power distribution company before installing the grid-connected solar system?
Yes, prior technical feasibility approval is required from the connected utility grid system.
- Will I receive cash/cheque for the exported energy to the grid?
Well, No! Don’t expect cash/ cheque for the number of units exported to the grid. The amount of energy supplied to the grid is recorded with the help of net metering, and at the end of the billing period the difference between the energy exported and imported is calculated, if the amount of energy exported to the grid is more in that case you don’t need to pay anything to the utility grid, the extra energy supplied will be carried forward in the next month.
- Is net metering allowed in all states?
No, the net metering policy is not allowed in all states/countries, before going for solar one needs to check and understand the savings better based on the respective regulation in the state.
If you want to switch to solar and are confused regarding which government incentive/subsidy you should opt for.
Don’t worry, our technical team at SunEdison will provide you with the best possible design solution and a hassle-free service right from government formality. (We will take care of all the government formalities required)