v· electricity policy for consumers who own (generally small) renewable energy facilities (such as wind, solar power or home fuel cells) or V2G electric vehicles. "Net", in this context, is used in the sense of meaning "what remains after deductions" — in this case, the deduction of any energy outflows from metered energy inflows. Under net metering, a system owner receives retail credit for at least a portion of the electricity they generate.
Most electricity meters accurately record in both directions, allowing a no-cost method of effectively banking excess electricity production for future credit. However, the rules vary significantly by country and possibly state/province: if net metering is available, if and how long you can keep your banked credits, and how much the credits are worth (retail/wholesale). Most net metering laws involve monthly roll over of kWh credits, a small monthly connection fee, require monthly payment of deficits (i.e. normal electric bill), and annual settlement of any residual credit. Unlike a Feed-in Tariff or time of use metering (TOU), net metering can be implemented solely as an accounting procedure, and requires no special metering, or even any prior arrangement or notification.
Net Metering is generally a consumer-based renewable energy incentive. While it is important to have Net Metering available for any consumer that interconnects their renewable generator to the grid, this form of renewable incentive places the burdens of pioneering renewable energy primarily upon fragmented consumers. Often over-burdened energy agencies are not providing incentives on a consistent basis and it is difficult for individuals to negotiate with large institutions to recover their Net Metering credits and/or rebates for using renewable energy.
In the U.S.A., as part of the Energy Policy Act of 2005, under Sec. 1251, all public electric utilities are now required to make available upon request net metering to their customers.:
‘‘(11) NET METERING.—Each electric utility shall make available upon request net metering service to any electric consumer that the electric utility serves. For purposes of this paragraph, the term ‘net metering service’ means service to an electric consumer under which electric energy generated by that electric consumer from an eligible on-site generating
facility and delivered to the local distribution facilities may be used to offset electric energy provided by the electric utility to the electric consumer during the applicable billing period.
In Canada, some Canadian provinces have net metering programs.
The United Kingdom government is reluctant to introduce the net metering principle because of complications in paying and refunding the value added tax that is payable on electricity, but pilot projects are underway in some areas.
Time of use (TOU) net metering employs a specialized reversible smart (electric) meter that is programmed to determine electricity usage any time during the day. Time-of-use allows utility rates and charges to be assessed based on when the electricity was used (i.e., day/night and seasonal rates). Typically the production cost of electricity is highest during the daytime peak usage period, and low during the night, when usage is low. Time of use metering is a significant issue for renewable-energy sources, since, for example, solar power systems tend to produce energy during the daytime peak-price period, and produce little or no power during the night period, when price is low.
In market rate net metering systems the user's energy use is priced dynamically according to some function of wholesale electric prices. The users' meters are programmed remotely to calculate the value and are read remotely. Net metering applies such variable pricing to excess power produced by a qualifying systems.
Market rate metering systems will be implemented in California starting in 2006 and under the terms of California's net metering rules will be applicable to qualifying photovoltaic and wind systems. Under California law the payback for surplus electricity sent to the grid must be equal to the (variable, in this case) price charged at that time. It can never be negative, meaning you cannot make money from selling the electricity back. If you generate more electricity than you use then over a period of a month you will be billed zero and not make any money, in effect you give away your extra energy if you do not use it.
Net metering enables small systems to result in zero annual net cost to the consumer provided that the consumer is able to shift demand loads to a lower price time, such as by chilling water at a low cost time for later use in air conditioning, or by charging a battery electric vehicle during off-peak times, while the electricity generated at peak demand time can be sent to the grid rather than used locally (see Vehicle-to-grid). No credit is given for annual surplus production.
In some Australian states, the "feed-in tariff" is actually net metering, except that it pays monthly for net generation at a higher rate than retail, with Environment Victoria Campaigns Director Mark Wakeham calling it a "fake feed-in tariff". A feed-in tariff requires a separate meter, and pays for all local generation at a preferential rate, while net metering requires only one meter. The financial differences are very substantial.
From 2009, householders will be paid 60 cents for every excess kilowatt hour of energy fed back into the state electricity grid. This is around three times the current retail price for electricity.
Commencing in 2008, the Solar Bonus Scheme pays 44 cents for every excess kilowatt hour of energy fed back into the state electricity grid. This is around three times the current retail price for electricity.
Ontario allows net metering for up to 500 kW, however credits can only be carried for 12 consecutive months. Should a consumer establish a credit where they generate more than they consume for 8 months and use up the credits in the 10th month then the 12 month period begins again from the date that the next credit is shown on an invoice. Any unused credits remaining at the end of 12 consecutive months of a consumer being in a credit situation are cleared at the end of that billing.
Areas of British Columbia serviced by BC Hydro are allowed net metering for up to 50 kW. At each annual anniversary the customer is paid 8.16 Cents  per KWh if there is a net export of power. Systems over 50 kW are covered under the Standing Offer Program. FortisBC which serves an area in South Central BC also allows net-metering for up to 50 kW. Customers are paid their existing retail rate for any net energy they produce. The City of New Westminster which has its own electrical utility does not currently allow net-metering. 
New Brunswick allows net metering for installations up to 100 kW. Credits from excess generated power can be carried over until March at which time any excess credits are lost. 
Net-metering for privately owned PV systems was established mid 1998 for a pilot-period of four years. Late 2002 the net-metering scheme was extended another four years up to end of 2006. Net-metering has proved to be a cheap, easy to administer and effective way of stimulating the deployment of PV in Denmark; however the relative short time window of the arrangement has so far prevented it from reaching its full potential. During the political negotiations in the fall of 2005 the net-metering for privately owned PV systems was made permanent.
Italy offers a very attractive support scheme, mixing net-metering and a well segmented premium FiT.
Net metering has been proposed by ASIF to promote renewable electricity, without requiring additional economic support.
Several bills are pending in Congress to institute a federal requirement that utilities provide net metering. They range from H.R. 729 which allows up to 2% net metering to H.R. 1945 which has no limit, but does limit residential users to 10 kW, a low limit compared to many states, such as New Mexico, with an 80,000 kW limit, or states such as Arizona, Colorado, and Ohio which limit as a percentage of load. Current as of June 2011 , only three states do not allow net metering, plus Washington D.C., twenty one have no limit on the number of subscribers using net metering. Only two, Arizona and Ohio, have no specific wattage limit on the power limit for each subscriber (see table). Colorado, Maryland, New Jersey and Pennsylvania are considered the most favorable states for net metering, as they are the only states to receive an "A" rating from the Network for New Energy Choices in 2007, 2008 and 2009.
Note: Some additional minor variations not listed in this table may apply. N/A = Not available. Lost = Excess electricity credit or credit not claimed is granted to utility. Retail rate = Final sale price of electricity. Avoided-cost = "Wholesale" price of electricity (cost to the utility). * = Depending on utility. ** = Massachusetts distinguishes policies for different "classes" of systems. *** = Only available to customers of Austin Energy or Green Mountain Energy (Green Mountain Energy is not a utility but a retail electric provider; according to www.powertochoose.com, Green Mountain prices are twice the average retail price).
Net purchase and sale
Net purchase and sale is a different method of providing power to the electricity grid that does not offer the price symmetry of net metering, making this system a lot less profitable for home users of small renewable electricity systems.
Under this arrangement, two uni-directional meters are installed—one records electricity drawn from the grid, and the other records excess electricity generated and fed back into the grid. The user pays retail rate for the electricity they use, and the power provider purchases their excess generation at its avoided cost (wholesale rate). There may be a significant difference between the retail rate the user pays and the power provider's avoided cost.
Germany, Spain, some States in the USA and other countries, on the other hand, have adopted a price schedule, or Feed-in Tariff (FIT), whereby customers get paid for any electricity they generate from renewable energy on their premises. The actual electricity being generated is counted on a separate meter, not just the surplus they feed back to the grid. In Germany, for the solar power generated, a feed-in tariff is being paid in order to boost solar power (figure from 2009). Germany once paid several times the retail rate for solar but has successfully reduced the rates drastically while actual installation of solar has grown exponentially at the same time due to installed cost reductions. Wind energy, in contrast, only receives around a half of the domestic retail rate, because the German system pays what each source costs (including a reasonable profit margin).
Sources that produce direct current, such as solar panels must be coupled with an electrical inverter to convert the output to alternating current, for use with conventional appliances. The phase of the outgoing power must be synchronized with the grid, and a mechanism must be included to disconnect the feed in the event of grid failure. This is for safety - for example, workers repairing downed power lines must be protected from "downstream" sources, in addition to being disconnected from the main "upstream" distribution grid.
Solar Guerrilla (or the guerrilla solar movement) is a term originated by Home Power Magazine and is applied to someone who uses an alternative energy source to illegally supply electricity back to a public utility grid. If equipment is used which circumvents safety systems it is extremely dangerous to workers repairing power lines.
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