Net Metering FAQ's
On this page, you will find answers to commonly asked questions about how net metering works and how it can help you save money on your electricity bill.
Net metering measures the difference between the electricity you buy from your utility and the electricity you produce using your own generating equipment. Your electric meter keeps track of this "net" difference as you both generate electricity and take electricity from the electric grid.
In Oregon, Montana, Washington and Idaho, any residential or small commercial electricity customer who generates at least some of their electricity is potentially eligible for net metering. Idaho Power can net meter for renewable and cogeneration systems sized 100KW or less. Montana Power customers can net meter for wind, solar and hydro systems up to 50KW in size. Oregon and Washington offer net metering to all customers for wind, solar, hydro and fuel cell systems 25KW or less.
If you live in another state, you can find out whether you are eligible by contacting your local renewable energy company or your utility.
You already had the ability to generate your own power for your own use. However, any excess power had to be wasted or stored in batteries for later. Net metering provides several benefits.
First, net metering allows you to get use for most, it not all, of the electricity you produce. It does this by permitting you to put any excess electricity you generate back into the electric grid and retrieve it within a certain time period, free of charge, for your use. Getting this high retail value for your excess electricity makes owning your own generating system more cost-effective.
Second, net metering allows you to get retail value for the excess electricity you produce. You get full retail value for the power you produce since every kilowatt hour you produce for your own use directly reduces you purchase of power from the utility at retail cost. Excess power under net metering now gets the same effective treatment if the excess power is retrieved within the month or year.
Third, because net metering permits you to effectively "store" your excess electricity on the electric grid, you can also now size your system larger and offset more of your annual electricity needs. Without net metering to give value to this "excess" electricity, you might otherwise make your generating system smaller to minimize the amount of time your system produces electricity in excess of your immediate needs. Unfortunately, a smaller system also means that you would produce less electricity when you did need it. Without net metering, your only alternative would be to purchase some additional device to store this excess power for your later use, such as adding batteries to you system. While having your own electricity storage would mean that you could supply your own power even if there were a "black-out" on the electrical grid, such storage is expensive and can reduce the cost-effectiveness of your system.
Fourth, net metering establishes state-wide systematic standards for connect with systems that coordinate with national standards unless absolutely justified, and in most cases cannot require you to purchase to pay for meters beyond the bidirectional meter that 95 percent of us already have. Consistent standards allows providers to standardize systems to lower costs and reduce administrative barriers to getting online.
Net metering allows you to use the electric grid, and the company that otherwise supplies you with electricity, as if it were a big battery. There will be times when your electricity needs are less than the amount of electricity your generating system is providing at the moment. Your generating system puts the excess electricity you do not need back into the electric grid to be used by others and allows you to take this same amount of electricity back out of the electric grid. Net metering permits you to "bank" your excess electricity and then withdraw it from the grid for your use.
For example, on a sunny summer day when no one is home, a photovoltaic (solar) generating system might produce more electricity than needed at the time. Conversely, in the evening, when everyone is home, electricity needs would exceed the output of the system.
Most electric meters measure electricity moving both into and out of your home or business. Generally, we are taking electricity from the electric grid for our needs. The meter runs "forward" as it counts up the kilowatt hours we have consumed. But if you generate electricity with a photovoltaic or wind generating system and you make more electricity than you need, net metering legally allows this excess electricity to run the other way through the meter and back into the electric grid. Just like running your car in reverse, the meter now turns backwards.
Net metering, thus, might result in your meter turning backwards at mid-day when the sun is the strongest and running forwards at night when a solar system stops operating. If you put 10 kilowatt-hours (kWh) of excess electricity into the electric grid during the day, net metering allows you to take 10 kWh of electricity out of the grid later and pay nothing extra for them. In effect, you are allowed to "bank" these 10 kWh and use them later to offset your need to buy 10 kWh. Thus, you can get full retail value for the electricity you generate.
Just as they do presently, your utility will continue to read your meter monthly. If you ran the meter backwards more than forwards, you would be a net generator for that month and see a credit on your bill. If you took more electricity from the electric grid than you fed back, you would be a net consumer and would see a bill for the difference.
In some states, bills can be carried forward for up to 12 months. Any excess after 12 months is zeroed out. In Oregon utilities can carry forward credits or pay each month for the excess generation.
Eligible systems cannot be larger than 25KW of peak power output in Oregon and Washington, 50KW in Montana, and 100KW in Idaho. However, economically your system should be sized so that it is capable of supplying some or all of your expected annual electricity needs, but not more than your needs. Estimate your annual needs and size your system to produce this amount of electricity, or less, over a twelve month period. Because your utility is not required to purchase excess electricity from you at the end of the year, keep the size of your system at or below your expected annual needs. It does not pay to oversize a system.
There is no minimum system size to be eligible for net metering. Most residential systems are in the 2 to 4 kilowatt range, but they can be larger or smaller depending on your needs and how much of your own electricity you want to generate. Also, it is possible to start with a smaller system and expand it later and still be eligible for net metering as long as your total system output is not greater than the limit your state allows.
Generally, yes. Most residential and small commercial customers have simple meters that are already capable of turning in both directions (bi-directional). Some utilities may want two meters for net metering, one meter to measure all electricity flowing into your home or business and one measuring the excess you are putting into the electric grid. If a utility wants two, one-way (uni-directional) meters, by law they, not you, must pay for them. You are only responsible for having a single, bi-directional meter, the type most residential and small commercial customers already have.
It's simple. Just contact your local renewable energy company or utility.
If you have problems, contact one of the following:
Solar Energy Industry Association at 541-346-4745
Renewable Northwest Project at 503-223-4544
Oregon Public Utility Commission at 503-378-6634
Montana Power Company, Dave Ryan, 406-497-2322