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March 2016

NET METERING

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Written by Nani Pradeepan, P.Eng.

Ontario’s Independent Electricity System Operator is preparing to switch incentive program from current Feed in Tariff program to Net Metering Program in 2017 hence it is important to understand the difference between these two programs.

Most grid-tied photovoltaic (PV) solar systems today have no equipment for storing the electricity generated by their rooftop solar energy systems to use later in the night and depend on the utility grid for its operation. Hence your solar power system under both feed in tariff program and net metering program do not need any kind of storage to operate.

With Feed in Tariff program, you sell all the electricity generated by your solar power system to the utility at higher price than you pay for the electricity when you consume. And you continue to buy all the electricity you need for your home from the utility at the lower retail price than the price paid under Feed in Tariff program. Because you are continuing to buy your electricity from the utility you do not need to have storage to store and use the electricity at night.

With net metering program when your solar panels produce electricity, it goes first to powering the lights, appliances and electronics in your home used at that time. If your solar power system produces less electricity than you need or if you need energy when the sun isn’t shining at all, that power is automatically supplied from the utility grid. If your solar power system produces more electricity than you need, the extra electricity is send back to the utility grid and you get credited for the electricity you send back to the grid at the same retail price that you pay for the electricity you consume from the grid.

With net metering, the homeowner is only billed for the “net” electricity used each month, that is, the difference between the energy produced by the solar power system and the energy consumed by the house over the monthly billing period. If your solar power system produces more than you consume in a billing cycle, you get credit and this credit is carry forward to next billing cycle and so on. Under the Net metering program offered in most jurisdictions any credit you accumulated must be used with in a calendar year. Ontario government along with IESO is currently formulating the rules for the Net metering program and it is commonly expected that this rule will also prevail in Ontario.

We have made an effort to explain the difference between these two programs, if it is still not clear to you or have other questions or would like to get a free solar assessment of your property do not hesitate to contact us.

Phone: 416-855-9377