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Submitted By: Muhammad Husnain Arshad

Submitted To: Dr. Salman Haider

Roll No.: 19013123-076

Section: B

Couse Title: Sustainable Energy Systems

Semester: 8th

Department of Chemical Engineering

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Net Metering
What is Net Metering?
Net metering is an electric billing tool that uses the electric grid to “store” excess energy
produced by your solar panel system. Under net metering, the energy produced by your solar
panels that you don’t use is credited back to you. On a cloudy or rainy day when your panels
aren’t producing enough energy, the utility grid will feed your home energy, and count that
energy against the credits you’ve banked over time. As a solar customer, you will only be billed
for your “net” energy usage. Also known as net energy metering or NEM, net metering is the
solar industry’s foundational policy.

How net metering works.

The type of net metering described above is the simplest example of the practice, and is also
called “true net metering” or “1-for-1 net metering,” because the utility offers credit for each
kilowatt-hour (kWh) of electricity sent to the grid, which can be redeemed toward a kWh used
when the sun isn’t shining.
When a homeowner gets a solar energy system installed, the utility replaces their electric
meter with a new bi-directional meter, which can record energy the solar panels export to the
grid and energy the customer takes from the grid when the solar panels aren’t making enough
power to run the home’s appliances.
At the end of each billing period, the utility totals up the energy that was sent to the grid and
energy used from the grid. If the homeowner used more electricity than they sent, the utility
bills them for the difference. If they sent more than they used, the utility records a credit
balance that will be applied to the next monthly bill.
Here’s a graphical representation of how that works, with an increasing credit during the
daylight hours that gets used up over the course of the night
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Not all net metering programs work in exactly the same way. Differences between net metering
programs include:
 Credit rollover (monthly vs. annual vs. indefinite)
 Value of credits
 Time of use rates

Components Required for Net Metering:

Net Metering system has a few conditions that need to be fulfilled in order for the system to be
installed. These requisites are as following:
Grid Connection
The first and foremost requirement for a net metering system to be installed is the connection
to the grid. This is the reason why the system only works with a grid-tie or a hybrid system and
is not compatible with an off-grid system.
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Three Phase Meter

A three phase meter is also a basic requirement to apply for net metering. If you do not have a
three phase meter, it can be installed after some procedure.
Sunction Load
The sunction load should be less than the system capacity. Net metering is available for a solar
panel system with minimum capacity of 3 KW. For a 3KW system, the sunction load must not be
more than 2 KW.
Things to Know
Before you can understand the flowchart of how net metering works, there are a few things
and terminologies that you need to have know-how about. These are explained below:
Peak Hours
These are the hours of the day when the electricity unit costs more than the rest of the day.
They are usually from 5pm – 10pm depending upon the season. They change a little bit
quarterly a year.
Off-Peak Hours
They comprise of the whole day excluding the peak hours. The solar system produces electricity
during off-peak hours. The electricity cost during this time of the day is lesser than during the
peak hours.
Import Units
These are the units that are imported from the grid station to fulfill the electricity requirement
of the house. They are usually less to zero during off-peak hours as the electricity is provided by
the solar panel systems.
Export Units
These are the units that are exported to the grid stations by the solar system owner. These are
zero during the peak hours and the night time as there is no input from solar panels during that
time.
Net Billing
The bills of peak hours and off-peak hours are calculated separately and then the net bill is
found by calculating the net bill which is Import units minus export units.
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Example
For house of 76 kW Solar System Setup and consumption of house is 65 kW
Solar System Capacity: 76 kW
Household Consumption: 65 kW
The calculations are for a specific time period, such as a day.
calculate the net metering scenario for a house with a 76kW solar system setup and a monthly
electricity consumption of 65kW, with a cost of Rs. 30 per unit.

1. Calculation of Electricity Generation:

Let's assume the solar system generates 76 kWh of electricity in a month.

2. Electricity Consumption
The house consumes 65 kWh of electricity in that same month.

3. Net Metering Calculation:

a. Excess Generation:
Since your solar system generated more electricity than your house consumed, you have an
excess of 76 (generated) – 65 kWh (consumed) = 11 kWh.

b. Deficit Generation:
There is no deficit in this scenario, as you generated more electricity than you consumed.

4. Net Metering Benefit:

If the cost of electricity is Rs. 30 per unit, your net metering benefit would be calculated based
on the excess generation:

Net Metering Benefit = Excess Generation × Unit Price

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Net Metering Benefit = 11 kWh × Rs. 30/kWh

Net Metering Benefit = Rs. 330

So, in this example, if the cost of electricity is Rs. 30 per unit, the net metering benefit for the
excess electricity you provided to the grid would be Rs. 330

Please note that actual net metering policies and calculations can vary based on your location
and utility company. It's recommended to consult with your local utility company or an energy
expert for accurate information related to net metering and its benefits.
Monthly Status of import and export of the electricity

Type Units
Import 450
Export 120
If the unit price is considered Rs. 30 per unit. The monthly bill for off-peak hours will be:

Type Units Price per Unit Total Price

Import 450 30 13500
Export 120 30 3600
Net 330 30 -9900

The negative charge indicates that the customer has supplied units worth Rs. 9900 to the grid
utility.

Advantages of Net Metering:

1. Cost Savings:
Net metering allows you to offset your electricity bills by receiving credits for excess energy
your solar panels generate. This can lead to significant long-term cost savings.
2. Financial Incentive:
The potential for saving money over time serves as a strong financial incentive for installing
solar panels, making renewable energy more attractive.
3. Reduced Environmental Impact:
Solar net metering promotes the use of clean, renewable energy sources, reducing your carbon
footprint and contributing to a greener planet.
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4. Energy Independence:
Generating your own electricity means you're less reliant on traditional energy sources and less
susceptible to energy price fluctuations.
5. Supports Grid Stability:
Excess energy from solar panels fed back into the grid can help stabilize it, especially during
peak demand periods.
6. Simplicity:
Net metering simplifies billing by allowing you to receive credits for excess energy and pay for
the net amount used, streamlining the payment process.