Net Metering Overview

Taking advantage of Washington’s Renewable Energy Production Incentives does not reduce or impact savings achieved through net metering.  Net metering is an electricity policy for consumers who own (generally small) renewable energy facilities, such as wind, solar power or home fuel cells. “Net”, in this context, is used in the sense of meaning “what remains after deductions” — in this case, the deduction of any energy outflows from metered energy inflows.  So, in addition to the production incentive payments, which are based on the total amount of power that their system has produced (no matter how much of that power they themselves consume), with net metering programs, individual producers are granted credit on their power bill for all of the energy they have produced but did not consume, that power which passes through the utility-installed meter and back into the grid.

Washington’s net-metering law applies to systems up to 100 kilowatts (kW) in capacity that generate electricity using solar, wind, hydro, biogas from animal waste, or combined heat and power technologies (including fuel cells). All customer classes are eligible, and all utilities – including municipal utilities and electric cooperatives – must offer net metering. 

Net metering is available on a first-come, first-served basis until the cumulative generating capacity of net-metered systems equals 0.25% of a utility’s peak demand. This limit will increase to 0.5% on January 1, 2014. At least one-half of the utility’s available aggregate net metering capacity is reserved for systems generating electricity using renewables.

As you can see from the following chart, the net metering program has grown substantially since it’s inception in 1999, growing from only 2 new customers in 1999 to 243 in 2008.

Of those involved in PSE’s net metering program thus far, a vast majority of the customers utilize solar PV systems to generate their grid-tied energy.  Of the projects in operation as of April 17, 2008, 243 were solar arrays, 4 were a combination of both solar and wind, 4 were powered by micro-hydro, and 3 were wind turbines.

In addition to state and national rebates and incentives, many local utility companies also offer rebate and loan programs to promote the installation of solar PV systems and other renewable energy systems such as wind power, as well as offering credits for the use of installing energy efficient windows, insulation, heat pumps, lighting, refrigerators, washers and dryers.

Private investors and communities are also getting involved in the expansion of renewable energy usage by creating large-scale solar projects, essentially creating their own, localized power production plants.  Like the home/business model, these large-scale or community power production facilities also receive incentives, in fact in excess of the substantial incentives being paid to individual net metering customers. Examples of these larger sites are the proposed Teanaway Solar Reserve and the Ellensburg Community Solar Project.