Wednesday, June 24, 2015

Net Metering with Solar Energy

Our local Electric Utility - IREA - wants to do away with net metering on houses with solar panel installations. This drastically changes the economics of installing solar panels.

Net Metering is method of accounting for energy production and consumption on a house with solar panels. On sunny days, you (ideally) produce more electricity than you use. This electricity is pumped back into the grid, running the meter backwards and earning you a credit. In the winter, or otherwise dark days, you consume more energy than your solar panels produce and (ideally) you can make up the difference with credits you earned and stored up during sunny days. With a properly sized solar system, you are using the electric utility as a perfectly efficient battery that can store energy for months, and you'll never pay an electric bill again. With an over-sized solar system, you can EARN money from the electric utility.

Obviously, net metering was only ever going to be an inducement for early adoption. If every customer actually earned money for the privilege of treating the utility as a battery, the utility would have no money coming in to pay for the maintenance of power lines (among other overhead costs) and would actually have to pay its customers.

Anyone who thought they would have access to net metering for 25 years (the warranty period for most solar panels) was kidding themselves.

However, Brianna and I thought that net metering would last at least a few years longer, not (potentially) end before we even got our panels installed.

So, for now, our solar panel plans are on hold. Our utility is supposed to decide what their new net metering rate plan is some time this month.


  1. Wow...that's too bad. Our utility (Clark PUD) has really embraced net metering...even putting up community solar panels and allowing those that bought into the project to take a percentage off their electric bills (net metering ish) for the life of the project (20+ years).

  2. By the way, did they give a reason why they want out of the net metering business?

  3. The implied reason is the bad economics.

    To be fair, IREA is a Coop, and their rates are pretty competitive. They also own a large minority share in a local coal plant, and apparently are obligated to use 25% of the coal plant's output over the lifetime of the plant - residential solar may be a threat to that, I'm not sure what the exact numbers are.