Net Metering is a special billing arrangement that provides credit to customers with solar PV systems for the full retail value of the electricity their system generates. The customer's electric meter keeps track of how much electricity is consumed by the customer, and how much excess electricity is generated by the system and sent back into the electric utility grid.Over a 12-month period, the customer has to pay only for the net amount of electricity used from the utility over-and-above the amount of electricity generated by their solar system (in addition to monthly customer transmission, distribution, and meter service charges they incur).
At any time of the day, a customer's solar system may produce more or less electricity than they need for their home or business. When the system's production exceeds the customer demand, the excess energy generation automatically goes through the electric meter into the utility grid, running the meter backwards to credit the customer account. At other times of the day, the customer's electric demand may be higher than the renewable energy system is producing, and the customer relies on additional power needs from the utility. Switching between solar system's power and the utility grid power is instantaneous-customers never notice any interruption in the flow of power.