Net Metering Can Slash Your Electricity Bill by 90 Percent

Mohidul Saad

Mohidul Saad is a co-founder of SOLARINSTALLGURU.COM, author and renewable energy benefit educator. He provides FREE online and offline training to home and business owners who are interested in reducing their electricity bills by 90 percent while slashing solar panel installation cost by 30-80 percent. DOWNLOAD this FREE renewable energy benefit education guide "101 ways to install solar system with little or no out of pocket cost" and start saving today.

Net Metering Can Slash Your Electricity Bill by 90 Percent

updated at : Friday, December 30th, 2016

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Net metering is a tool adopted by many power companies the will help reduce your electric bills. This tool allows you to send over the excess electricity generated by your solar power system to the power company and get paid for it. There are many forms of net-metering and we will cover the basic concept so that you are familiar with the main idea.

Net Metering Can Help Slash Electricity Bill by 90 Percent for Your Solar Power Home

Net metering advantages

Net metering is a mechanism to sell excess energy produced by your energy system to your power company. You sell the electricity back at the same price that you buy it for. Meaning, if you pay 13 cents/kWH, your power company will pay you the same price for the excess electricity your solar power system sends over. Depending on the contract your state has made with the power company, you will receive cash or credit for the excess electricity. When your solar energy system makes more electricity than is needed by the power demands of your home, the excess power flows back to the power company grid and the power company keeps track of that electricity. Your electric meter, which keeps track of your power usage, will turn backward. The meter usually turns forward when you buy power from your power company.

Make Money In Peak Hours

Your solar energy system will generate most of the electricity midday -known to be peak hours. During the peak hours, the power company rates are the highest. The rates are lowest at the off-peak hours of the night. Producers earn the most money during peak hours because they are selling excess electricity at peak rates. The producer then buys the electricity back at much lower “off-peak” rates at night. In the process, you make a profit and put green cash into your pocket.

How Does Off-Peak Hour Work

Some power companies do not make any differentiation between solar energy generated during peak-hours vs. off-peak hours. They have a fixed buying price. These power companies make you pay for the net-use of electricity. They calculate the net-use by subtracting excess solar energy from the total energy that came from the power company grid. The net-use version is less profitable but still provides an opportunity to be able to sell your excess electricity.