What is net metering and how does it work?

 What is net metering and how does it work?

What is Net Metering?

Net metering is a billing mechanism that credits solar energy system owners for the electricity they add to the grid. For example, if you have our PV system on the home’s rooftop, it may generate more electricity than your household requirement during daylight hours. If the home is net-metered, the bi-directional electricity meter will measure the energy that goes into the grid, the sold units will get credited against off-peak units in consumer bill. Customers are only billed for their “net” energy use. On average, about 20-40% of a solar energy system’s output goes into the grid.

How does net metering work?

Say you install a net metered solar panel system. When your solar panels are producing more electricity than you are using at any point during the day, the electricity is sent back to the grid, running your electric meter in reverse. When you use more electricity than your solar panels are producing, either at night or on cloudy days, you pull electricity back from the grid, running your meter forwards. At the end of the month or year, you are billed the net amount of what you put onto the grid and what you took off the grid: hence “net metering”.

With a correctly sized solar energy system, you can produce enough electricity to match your home’s electricity use for the entire year. However, the amount of electricity your solar panels produce will vary throughout the year: more in sunnier summer months, and less when the sun is lower in the sky and sets earlier in the winter. Net metering helps you to account for these seasonal differences in solar production by crediting you for the excess electricity your panels produce so that you can use it at a later date.

How do electricity bills work with net metering?

In general, most homes will produce excess electricity in the summer months and will use more electricity from the grid in the winter. Because these variations in production are fairly predictable, your utility won’t send you a monthly check when you produce more than you need. Instead, you will build up extra credits during the summer months so that you can draw from them at night and during the winter months when you need them. With the right design, your system can generate enough power to match your total electricity use for a year, even if you produce much more than you need in some months and much less in others.

When your solar power system generates more electricity than you use over the course of a month, you will receive a credit based on the net number of kilowatt-hours you gave back to the grid. If you produce less electricity than you use in a given month, you must buy electricity from your utility to make up the difference. In these instances, you would pay for the electricity you use, minus any excess electricity your solar panels generated.

Use net metering to save by going solar

Net metering is the best solar policy, since it allows you to store every unit of energy you produce with solar to be used at a later date from the grid. In fact, thanks to net metering, you can save tens of thousands of dollars over the lifetime of their solar panel system by offsetting your need for electricity from the grid.

 While net metering is not the only way that utilities compensate homeowners for going solar, it is by far the most common and effective solar policy. Keep reading to see if your state offers net metering, and be sure to check out the Database of State Incentives for Renewables and Efficiency (DSIRE®), which tracks net metering and other policies.

 To see how much you can save with solar, check out the EnergySage solar calculator, or register for a free account on EnergySage to see custom solar quotes from local installers today.

NEPRA Net Metering Rules and electricity rate in Pakistan

National Electric Power Regulatory Authority recently presented their Net Metering facility with alternate energy development board aedb approving certain vendors only after these fulfilled stipulated criteria. Conservation is the lowest cost alternative (net solar) to high utility bills. If everyone reduced their consumption by 20 percent, there would be 20 percent more money staying in your pocket. The cheapest kilowatt is the one you don’t have to go out and purchase.

Net metering rates in Pakistan

Likewise, it could be equally vocal to get your free energy and be able to sell the excess back at a very lucrative rate. National Electric Power Regulatory Authority recently presented their “net metering” program to the public of Islamabad, Rawalpindi and Lahore. This net metering plan credits customers for the electricity they produce in excess of the electricity they are consuming after every three months.

 Compare this net metering plan to paying a monthly utility bill and getting no return on investment. Net metering is a billing arrangement by which a net meter (Bi-directional meter) is installed at any Grid-Tied Renewable Energy system (Solar and wind power system) which import electricity when production from the solar system is less than demand and it exports electricity when electricity production through the solar system is more than the demand and at the end of the month the Utility company sends the monthly bill of the net meter and this gives a saving to a consumer who sells their excess electricity and benefit to Utility of having solar electricity for other consumers to use when Renewable system exports electricity.

 This is especially useful because a home energy system typically doesn’t produce its energy at convenient times. A solar system, for example, has maximum production capacity during the daylight hours, but most energy use happens at night. That’s when artificial lighting is needed. It’s also when people are usually at home. In the winter months, it’s the time of the greatest energy cost for heating the home. With an on-grid system using net metering, the system can “sell” energy to the utility during times of high production and low use, for a credit that can be used to “buy” energy back from the utility during the times of low production and high use.

 Remember electricity unit rate in Pakistan 2019 has inflated by more than 5% than the preceding year this typically highlights the positive economic effect of Net Metering with solar energy. While keeping in view the grid parity since the electricity rate in Pakistan has never remained constant, a net metering system feeds power from the home production system into the grid, which the utility can sell to other customers. During times when the home is producing energy (usually from a solar or wind power system), and more energy is being fed into the grid than taken from it, the utility’s accounting system “pays” the customer for this energy in the form of a credit that can be used to buy energy from the utility.

 During times when more energy is being drawn from the grid than added to it, the credit is reduced to pay for the energy consumed. At the end of the month, if more energy has been consumed than produced by the customer, the utility charges the customer for the difference. If more energy has been produced than consumed, the utility pays the customer for the difference using an energy meter – usually at a much lower rate.

 The average differential rate for electricity applied is averaged @ Rs. 18.64 per unit for Residential buying, @ Rs. 22.2 for Commercial buying and @ Rs. 11.3 for Industrial buying as per incentivized net metering policy and Wapda unit price in Pakistan. Kindly note that net meter reading is performed on compliant equipment only and thereby it is discouraged to use Gas Generators or Diesel Power Generators to be attached for this purpose. Hence, do not buy anything that sells cheap in the market. It shall go waste.

Why MUSTAFA SOLAR?

Net Metering Pakistan

MUSTAF SOLAR provides complete assistance from preparing net metering application form till successful commissioning through net metering activation. We are authorized by the Alternative Energy Development Board (AEDB) for net metering installations across the country. Many cases have been registered and completed for net metering systems and the total count is one the rise. According to the statistics, So far we have successfully implemented Net Metered Power Plants in Pakistan in more than 33 cities. Generate electricity, save excessive, and earn by selling it back through Mustafa's net-metered solar solutions.

Through SBP’s Solar Financing Pakistan scheme to encourage people of Pakistan for Solar Financing in Pakistan who are belonging to the industrial, commercial, residential, and agricultural sector to invest in renewable energy sources.