How net metering benefits solar and non-solar customers alike

By Brandon Walton on July 30, 2015

Net metering is a policy that allows residential and commercial solar energy generators to offset their energy consumption with their solar energy production. When a solar system produces more electricity than the home is using at that moment, the excess electricity is sent back out through the customer’s electric meter. The homeowner receives a credit on their electric bill based upon the amount of excess electricity generated.

When a solar customer uses more electricity than the solar system produces, the electric meter runs forward. At the end of the month, the final electric utility bill is the total usage minus the electricity that the solar panels produced. Should the customer produce more in a month than they use, the credit on their bill can be rolled ahead to the next month. Customers do not receive net metering credit for the electricity they produce in excess of their estimated annual usage.

Net metered solar provides power when electricity demand is highest

Solar panels produce electricity during the day. At the same time, higher electricity demand forces utilities to meet energy needs with more expensively produced electricity. This demand raises electricity prices for everyone. The addition of solar to the grid helps lower everyone’s cost of electricity by lowering demand from solar users, and also adding electric capacity to meet non-solar users’ needs. Net metered customers can generate excess electricity that can be used by their neighbors.

Net metered solar saves transmission and distribution costs

Net metered solar generation produces electricity at or near the site of demand. Solar does not require the investment in transmission or distribution lines that electricity from large, centrally-located plants do. Producing electricity closer to demand is also more efficient. It is estimated that roughly 6% of electricity produced in this country is lost due to transmission.

Net metered solar creates good, local jobs

Solar energy won’t continue its impressive growth if solar customers are denied from receiving a fair price for the electricity they generate. Nationwide, there are more than 174,000 workers in the solar industry. This figure is expected to grow by 20% just this year. Most solar employment is in jobs like installation that can’t be outsourced.

Further reading

Several non-partisan agencies and organizations have done in depth studies to determine impact of net metering on non-solar customers. Overwhelmingly, they’ve found non-solar customers benefit from their solar neighbors.


The Nevada Public Utilities Commission found that rooftop solar will provide more than $30 million in net benefits to Nevada ratepayers over the next several years.


A study by the Missouri Energy Initiative found that net metering provided an overall positive value to Missouri customers by comparing associated benefits and costs.


The study, completed for the Mississippi Public Utilities Commission found net metering would provide a net benefit to customers in every scenario reviewed.

New York

This study found that solar provides a benefit of between 15¢ and 40¢ per kilowatt hour to ratepayers. This benefit justifies the compensation solar producers receive from net metering.


Vermont’s Public Service department was tasked with evaluating net metering. It found that net metered solar does not impose a significant net cost on non-solar ratepayers.[/expand]