Net metering in Indiana

What is net metering?

Net metering is the policy that allows people with solar energy systems to get a credit on their electric bill for the energy they produce from their system.

Billing and compensation

Investor-owned utility (IOU) customers with net-metered systems will be credited for each kilowatt produced by their system and each month will be billed for the number of kilowatt hours they used, minus the number of kilowatt hours generated. If your generation exceeds your usage for a given month, you will receive a credit for each excess kilowatt hour, to be applied in later months when you generate less electricity than you consume. Credit for excess generation will rollover from month to month indefinitely. Customers of rural electric member cooperatives (REMC) and municipal utilities may have different policies for billing and compensation of net-metered systems.

Net metering in Indiana

System capacity limit The customer’s average annual consumption of electricity on the premises, up to 1 MW
Monthly excess generation credit rate Full retail credit (for systems installed before December 31, 2017, the full retail credit will be available until July 1, 2047; for systems installed after January 1, 2018 and before July 1, 2022, the full retail credit will be available until July 1, 2032)
Annual excess generation credit rate Full retail credit (credit rolls over indefinitely as long as the customer remains a customer at the utility)
Statewide net metering cap 1.5% of the most recent summer peak load at each utility, with 40% of this capacity reserved for residential customers (.6% overall) and 15% of this capacity reserved for biomass projects (.225% overall)
Applicable utilities Investor Owned Utilities (IOUs)

Who is eligible for net metering?

All Indiana customers of IOUs are eligible for net metering. Customers with systems installed before December 31, 2017, will receive the full retail credit for their excess electricity production until 2047. However, a 2017 state law (known as SEA or SB 309) changed Indiana’s net metering rules for systems installed after January 1, 2018. New net metered systems will be eligible to receive full retail rate net metering (which means you get a 1-to-1 swap for the electricity you send back out to the grid at the same price that you purchase it from your utility) in every IOU service area until the potential generating capacity of net-metered systems (like rooftop solar) reaches 1.5% of the  summer peak load in a specific utility territory, or July 1, 2022, whichever comes first. You can find each utility’s progress toward this cap in the Indiana Utility Regulatory Committee regular net metering reports available online. The current full retail net metering credit will be available for systems installed after January 1, 2018 until 2032.

The Indiana Utility Regulatory Commission (IURC) will set a new rate of compensation for the excess electricity sent back to the grid based on the average marginal price of electricity paid by the supplier during the most recent calendar year, plus a 25% premium for each individual IOU. Under the current law, this new rate will be applied to all systems installed after July 1, 2022 (or earlier, if the utility reaches the 1.5% threshold described above), and will be applied to systems installed between 2018 and 2022 after the current program sunsets in 2032. As of spring 2019, the IURC is seeking more information from utilities and advocates such as Solar United Neighbors to clarify the next phases of implementation.

For those looking to read the full details of Indiana’s net metering policy, Indiana Code §§ 8-1-40 is the statute establishing the rules for IOUs in the state.

Net metering resources in Indiana

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