How will solar power and Net Metering affect my utility bill?

Once solar is installed on your home or business, the power runs any electrical appliance being used. This includes air-conditioning, lights, computers, televisions, and possibly your stove, hot water heater or furnace. Using solar energy instead of electricity from the grid decreases your electric bill. If your home or office needs more energy than your system produces, electricity is taken from the electric grid without any power interruption.

Any excess solar electricity that is not used in the building is sent to the electric grid. The electric utility installs a bi-directional meter when your PV system is in place which measures energy coming from the grid as well as any excess solar energy which goes back to the grid. Solar energy goes back to the grid is deducted from the electrical usage coming from the utility. Your final bill is the amount of energy from the electrical grid minus the credit for excess solar energy. This process is known as “net metering”. See the example below:

As illustrated, the residential customer has Total Energy Needs of [A] 1,000 kWh per month. During daylight hours that month, the homeowner’s rooftop Solar system generates [B] 600 kWh of power. The customer only uses [D] 250 kWh to meet the family’s needs during the daytime. So the remaining [E] 350 kWh, is exported back to the grid. During the night, the family relies on the utility to deliver its remaining energy needs. The customer is only billed for the Net Consumption of [C] 400 kWh, which is equal to the Energy Delivered [F] minus the Energy Exported [E].
It’s important to note that solar production will be credited on your account at the “generation” rate. Regardless, the installation of solar can greatly decrease your electric bill now and for years to come as electricity costs continue to rise.