What is Net Metering?

Net metering is a solar policy incentive that allows for excess energy (kWh) produced by a solar energy system to be cycled back and used on the electricity grid. As defined by the Solar Energy Industries Association, net metering is “a billing mechanism that credits solar energy system owners for the electricity they add to the grid.”

The local electric grid serves as a backup for every solar energy system. If a residence or commercial building uses more energy than the solar energy system produces, the local electric company will bill for the amount of energy utilized from their electric grid. Net metering allows for the opposite to occur. If a solar energy system produces more energy than is consumed, the local electricity company buys back the excess energy at the same rate as the cost per kWh.

STITT SOLAR CEO, DAVID STITT, DISCUSSES NET METERING IN THIS VIDEO FEATURING OUR FRIENDS AT FIRST NATIONAL BANK OF NWA.

How does it Benefit Solar Energy Producers?

Most solar energy systems produce more energy than they consume. When this happens, the excess kWh are bought by the electric company and applied to future bills for when energy production is lower. In Arkansas, utility companies are required to credit the full amount of the cost per kWh. For example, if a kWh costs $.10, the customer would be compensated at a rate of $.10 per excess kWh produced.

Giving back to the grid

Arkansas residents are not strangers to power shortages. Net metering can aid in reducing the grid overload that contributes to those outages. While generating only the necessary energy is encouraged, net metering reduces the strain on electricity distribution.

Producing clean energy, reducing your electricity bills, and creating a better tomorrow—now that’s a breath of fresh air!