A work colleague is getting photovoltaic solar panels installed and we got into a discussion of "net metering". Wait, don't stop reading now, I promise to keep this short.
"Net metering" is a simple rule that says, if the utility charges you, say 16 cents per KWH (kilowatt-hour) for electricity that you consume, then they must pay to 16 cents per KWH for any electricity you produce. It is basically a fair-is-fair or KWH for KWH trading between you and the utility.
But what happens if you produce excess electricity. If the power company can buy electricity for, say, 4 cents per KWH on the open power market, why should they pay you, say, 16 cents per KWH for your excess solar power.
So my understanding was that that the utility would only pay wholesale rates for excess electricity, say 4 cents/KWH. My colleague's understanding was that you got paid retail rates for excess electricity, say 16 cents/KWH.
It turns out that we were both right. Or more exactly, I was right 4 years ago (when my system was installed) and my colleague is right now.
Here is some data culled from my electricity bills for the last six years. The first thing to note is that I don't produce excess electricity every month, so there are a lot of holes in the data. The second thing is that I excluded some other data due to accounting issues (these bills are basically hand processed, the automated billing can't handle it).
After 2010, the new net metering regulations required the utility to pay me retail rates which has been just below 16 cents for the last four years. This is the same rate (roughly) that the power company charges me, and four times what I was getting in 2009 for my excess electricity. This is not a huge sum of money (never more than $20 in a single month), but still a nice benefit for owners of solar panels and one more enticement for others to do the right thing and get solar panels...ya know, global warming, energy security, pollution, yada yada yada.
The kicker is this. You cannot make money from this system. The "credits" that appear on your bill in terms of dollars can never be paid out in cash. The money always stays with NSTAR, one way or another. Most likely you will use credits earned in the summer to help offset your bill in the winter, which is awesome. If you consistently over produce, your credits can be applied to someone else's bill, e.g. a family member or your church.
The rules about net metering can be found here http://www.mass.gov/eea/grants-and-tech-assistance/guidance-technical-assistance/agencies-and-divisions/dpu/net-metering-faqs.html but it is not for the casual reader. Let me end with a sentence from that web page.
"Net metering credits are calculated in a complex and detailed manner"
