With the increasing gasoline prices and decreasing solar panel prices, it is no brainer that investing in a solar system would pay off and put more money in your pocket in the long term. According to theCanadian Renewable Energy Association, the installed solar power of Canada in 2020 increased by 10% with 130 MW/250MWh capacity. Ontario is the primary driver of solar energy growth, having the largest installed solar capacity of 2,709 MW (source:Solar Feeds, 2021). This trend is expected to accelerate even more, especially with the introduction of a net-metered solar system.

What is net metering and how does it work?

Net metering (also known as net energy metering (NEM) or grid-tie power buy-back program) is an electric billing program that uses the electric grid to store excess energy produced by your solar panel system. Under net metering, the energy that your solar panels produce and do not get used is credited back to you. It allows you to put unused solar energy to good use. Whereas solar panel batteries allow the owners to save the energy until they need to use it, net metering allows the owner to share the energy with the community.

When you have a rooftop solar system, it can often generate more electricity than you consume during daylight hours. On a cloudy or rainy day when your solar panels are not producing enough energy, the utility grid will feed your home energy, and count that energy against the credits that you have banked over time.

When your house, cottage, or business is net-metered, you will see the meter run backwards. This means you might get a credit to hedge against the electricity you use from the grid when it is not sunny or at nighttime. You are then billed only for your "net" energy use. The excess energy generated gets put back to the grid for your neighbors to use. This can reduce the demand on the electric grid, extend the environmental benefits of solar energy to more people, and save you money as a solar panel owner. Typical Net Metered contracts are valid for 20 years and any built up credit is valid for 12 months. For example, credit built up in March is valid until the following March.

What are the pros of solar net metering?

The main benefits of solar net metering are:

1) Save Money and Reduce Payback Period – Home and cottage owners can save thousands of dollars on utility bills every year by using net metering. As a result, you should be able to recoup the initial solar panel investment much earlier than if you do not take advantage of a net metering program. For example, the average payback period for standard residential solar panels in New Jersey is 4 to 5 years. In contrast, the payback period in a state without net metering policies could be greater than 10 years.

2) Increase Awareness and Control over Your Utility Bills – Becoming more aware of the energy that you are using makes you more mindful about it. This can motivate you and family members to conserve electricity more, as it will mean more money will be credited to your account.

3) Reduce the Strain on Electric Grid Demand – Because your solar system is generating electricity near the point where it will be used, this reduces the strain on the grid's distribution and transmission infrastructure. Net metering system also minimizes energy loss from sending voltage many miles from the nearest power plant.

4) Contribute to Environmental Sustainability through Renewable Energy – When you contribute your excess solar power back to the grid, it means that less energy needs to be pulled from non-renewable energy sources. This makes the local grid more environmentally friendly. In addition, because the energy is generated locally, you are further helping the environment by reducing the carbon footprint that comes with transporting those non-renewable energy sources into the community from elsewhere.

5) Net Metered Systems with Battery Backup can be used without the grid – If an extended power outage would to occur, your solar system would be able to run most or all of your home. Your home essentially become an off grid home until the power outage is resolved. This feature provides you with piece of mind and additional safety. To benefit from this feature, make sure to purchase a system that either comes with battery backup or the capability to do so if you would like to add batteries at a later date. All HPS packages can be configured for net metered, The Starter and Cottager can be upgraded to operate net metered, just mention this to our team when ordering. 

What are the cons of solar net metering?

Despite the benefits, there are some drawbacks from solar net metering:

1) Solar Net Metering is Not Uniformly Available Everywhere (Yet) – In the United States, some states do not have solar net metering policies in place yet. In Canada, luckily all provinces and territories offer a net metering or grid-tie power buy-back program. Contact your local jurisdiction for net metering programs in your area, confirm the process with your utility provider, and consult with a solar installer such as Hybrid Power Solutions.

2) Requires Connection to the Grid – Because net metering relies on a connection with the utility company, and pays with credit rather than cash, you will not be a candidate for net metering if you are completely off the grid. In this case, you will need to invest in a solar energy battery to privately conserve your excess energy to use at night or during other times when the system isn’t generating electricity. Hybrid Power Solutions offers some off-the-grid solar solutions such as The Chateau.

How to get started with net metering?

Step 1:Determine whether you live in an area that supports net metering. Net metering is offered in all Canadian provinces and territories, as well as in 38 states in the U.S. Even in states that do not mandate net metering, some major utility companies still offer the option to solar power users.

Step 2:Contact your local utility company to confirm the details of their net metering of grid-tie power buy-back program.

Step 3:Find a local solar system installer such as Hybrid Power Solutions.

To use net metering, you must be connected to the grid – which is the case for the majority of solar energy users. Even with a highly efficient solar energy system, it might not be able to continually generate electricity during nighttime hours, cloudy days, and darker winter months. During these times, you will likely need to pull electricity from the grid.

When is the best time to install a solar system?

NOW is the best time to install a solar system! To get the best savings through net metering, consider going solar sooner rather than later. This will kick-start the process of the payback period from installing solar panels, which will be dramatically reduced if you use net metering. If you wait, you run the risk of your utility company cutting the program, which means you will save less in the long run.