More and more consumers are turning to solar panels to power their homes. Renewable solar energy has become a cost-effective way to reduce monthly utility costs, while also benefiting the environment. But it’s no secret that solar panels don’t produce electricity when the sun goes down. So how do homeowners power their homes after the sun slips beneath the horizon?
Many homeowners invest in batteries to store the excess electricity their system produces during the day to use at night. However, solar batteries are expensive and require more maintenance than systems without batteries. But there is another way to use your solar’s excess daytime energy generation: Net Energy Metering.
Net Energy Metering (NEM) is a program utility companies offer customer’s with solar panels. With NEM, customers can connect their renewable energy system to the power grid, allowing them to pull energy from the grid for nighttime energy needs. If you are going to invest in clean, sustainable energy, you need to know the ins and outs of NEM and how it can benefit you.
NET ENERGY METERING IN A NUTSHELL
In many states, NEM has been in place for over a decade. Compared to other states, the NEM process in Florida is fairly standard. Net Energy Metering allows customers to connect to the power grid to earn credits or money for excess solar energy production to offset energy usage at night.
The utility company replaces the home’s existing meter (designed to measure only energy consumption) with a bi-directional meter that can also measure the energy sent back into the grid. For each kilowatt hour of energy sent back into the grid, you receive a credit.
Each utility company has their own application process that includes certain stipulations (equipment installation, system capacity, insurance, etc.), but the government regulates NEM:
NET ENERGY METERING REGULATIONS
NEM legislation was enacted in Florida in June of 2008 and standardized in July of 2009. Under Florida law, all utility companies are required to offer Net Energy Metering; however, the regulations set forth by the Florida Public Service Commission (PSC) differ between investor-owned (public) utilities and non-investor owned (municipal and electric cooperatives) utilities.
REGULATIONS FOR INVESTOR-OWNED UTILITIES
Customers with solar panel systems up to 10kW fall under residential rules and regulations as follows:
- The utility company must offer full retail value for each kilowatt hour your system produces at a one-to-one ratio. Each month your electric bill will show the total amount of energy consumed minus the amount that was generated. If your solar produced more energy than you consumed, you are given a credit (retail value) for each excess kilowatt that will be applied to next month’s bill or any future bill when you did not generate more than you consumed.
- At the end of a 12-month billing period, the utility pays you for any unused credits. But the utility company does not have to pay you full retail value for these remaining credits. They pay you the avoided cost, which is lower than retail, so don’t save your credits, use them.
- Utilities are prohibited from charging fees to net metered customers that they would charge a non-net metered customer.
Again, each public utility has their own application process for NEM setup. The public utility companies in Florida are Florida Power & Light, Duke Energy, Tampa Electric, and Gulf Power. Click on the company name to access their NEM application pages.
REGULATIONS FOR NON-INVESTOR OWNED UTILITIES
The PSC requires non-investor owned utilities (municipal and electric cooperatives) to offer customers with renewable energy systems NEM; however, the PSC does not regulate what these utilities must pay customers for their excess energy generation. This means some companies may provide a credit for your excess energy at a rate lower than full retail. For example, JEA credits their customers the fuel cost for their excess kilowatt hours. Their fuel cost is just under half of retail value.
Click on the company name to find out more about its NEM program and application process:
- Florida Keys Electric Cooperative Association (Monroe County)
- Keys Energy Service (Lower Keys)
- Fort Pierce Utilities Authority (Fort Pierce)
- Gainesville Regional Utilities (Gainesville)
- Homestead Energy Services (Homestead)
- Jacksonville Energy Authority – JEA (Northeast Florida)
- Kissimmee Utility Authority (Osceola County)
- Lakeland Electric (Lakeland)
- Lake Worth Utilities (Lake Worth)
- New Smyrna Beach Utilities (New Smyrna Beach)
- Ocala Utility Services (Ocala)
- Orlando Utility Commission (Orlando)
- City of Tallahassee Electric Utility (Big Bend)
- City of Vero Beach Electric Utility (Vero Beach)
MAXIMIZING NET ENERGY METERING
Net Energy Metering is a great way to ensure renewable energy powers your home 24/7. But how you live in your home affects how much excess energy you are able to generate. Florida ranks third in energy consumption. The more efficiently you can live, the better.
Purchasing solar panels for your home doesn’t make sense if you don’t also make your home as energy-efficient as possible. Energy-efficient appliances, hybrid water heaters, LED lighting—these are just a few improvements you can make to reduce your home’s energy consumption. The less energy your home consumes, the more excess energy your solar system will generate.
If you’re curious how your home measures up, check out the HERS Index program. Performing an energy audit is a great way to find out how efficient (or not) your home is. The audit comes with a detailed report of your home’s energy performance, so you’ll know where improvements can be made.
If you’re in the market for a new home, check out our solar-powered, energy-efficient models.