Can I Sell Electricity Back to the Grid?

In addition to the altruistic benefits of using renewable energy, solar panels can also be a wise long-term financial investment.

Everyone knows that solar panels can help put more money into your pocket in the form of reduced monthly energy costs, but they can also put more money into your pocket through a process called “net metering.”

How Net Metering Works

Net metering is a solar incentive born out of a relationship between a solar user and its utility that allows both parties to benefit from grid-tied solar energy.

When your grid-tied solar energy system produces more power than your home needs, you can send that excess energy back to the grid. In exchange, your utility will allow you to draw on power from the grid when your solar energy system is not able to meet your home’s power demands by itself.

Source: EnergySage

Net metering helps to smooth out ebbs and flows of solar energy production throughout the year by crediting the solar consumer for excess solar energy produced. Over time, it’s possible that the solar household will accumulate more credits than it uses, thus allowing homeowners to use credits earned to reduce future energy bills.

The rate you earn for surplus power is typically the same as the per kWh rate you pay your utility for electricity.

Who is Eligible?

Net metering eligibility ultimately boils down to where you live and what utility serves your home. Net metering policies can vary greatly by state and by utility. Most utility net metering contracts use a tiered system based on kWh capacity to determine net metering rates, and to separate residential users from nonresidential systems.

The Database of State Incentives for Renewables & Efficiency (DSIRE) is a great resource to help understand what net metering policies apply to your state. The DSIRE also does a good job of providing updated information on state-specific net metering legislation.

Photo Source: DSIRE

As of November 2017, 38 states (in addition to D.C.) have mandatory net metering policies in place. While the other states lack such mandatory policies, many of them still have individual utilities that allow net metering, or a statewide compensation policy that works similar to net metering. Contact your utility directly to learn more about your options.

If the opportunity to take advantage of net metering doesn’t exist in your state or through your utility, then solar batteries might be a smart investment. Visit our page on deciding whether solar batteries are a good fit to learn more.

Renewable energy is a long-term investment in our planet’s future, but it also represents a potentially lucrative financial investment for the end-user. Net metering is just one example of how your solar energy system can save you money.