6.Net Metering Explained: How You Can Sell Solar Power Back to the Grid

Jorge

Jul 18, 2025 — 2 min read

Net metering is one of the most powerful incentives available to solar energy users. It allows homeowners and businesses with solar panel systems to send excess electricity back to the grid and receive credits on their utility bills. But how does it actually work? This blog breaks down the mechanics of net metering in simple terms, including how meters track power usage and generation, how credits are calculated, and what policies exist in different regions. We’ll also explore pros and cons, how to maximize your savings, and recent policy changes affecting net metering across the world. A must-read for anyone looking to get the most out of their solar investment.Net metering is a billing mechanism that allows owners of solar energy systems (or other renewable energy sources) to sell excess electricity they generate back to the grid. In simple terms, if your solar panels produce more electricity than your home or business consumes, the surplus energy is fed into the public electricity grid, and you receive credits on your electricity bill. These credits can be used later when your energy consumption exceeds your solar generation, such as at night or during cloudy days.

How Does Net Metering Work?

Net metering relies on a bidirectional (two-way) electricity meter that can measure the energy you draw from the grid and the energy you send back. Here’s a step-by-step breakdown:

1. Daytime Production:
*During the day, especially at peak sunlight hours, solar panels often produce more electricity than is needed.

*This extra power is not wasted — it's sent back to the utility grid.

2. Excess Electricity Sent to Grid:

When this happens, the bidirectional meter records the amount of power exported.
You receive a credit for every unit (kilowatt-hour or kWh) of excess electricity sent to the grid.

3. Nighttime or Cloudy Days:

When your solar panels are not producing enough electricity (e.g., at night), your system draws power from the grid.
The electricity consumed from the grid is measured by the same meter.

4. Monthly or Annual Reconciliation:

At the end of a billing cycle, the electricity company calculates the net usage: electricity consumed minus electricity exported.
If you’ve exported more than you used, your bill may be zero, or you might carry forward credits to the next month.

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