In most
states, consumers can install small, grid-connected renewable energy
systems to reduce their
electric bills using what is called net
metering. With net metering, electricity produced by the renewable
energy system can flow into the utility grid through the existing
electricity meter.
The meter
spins in the
normal direction when the consumer is using more electricity than is
being produced.
It spins backward when the renewable energy system is
producing more
electricity than the consumer is using.
This provides the consumer with full retail value
for all the
electricity produced. The intent of net metering is
to allow
consumers to use their energy production to offset their electric
consumption over a period of time.
In
some states, consumers can only use the
electricity they produce to offset their electricity demand on an
instantaneous basis. If the consumer happens to produce any excess
electricity beyond what's needed to
meet their needs at the moment, the
utility purchases that excess electricity at the wholesale or 'avoided
cost' price, which is much lower than the retail price. Net metering
simplifies this arrangement by allowing
the consumer to use any excess
electricity to offset electricity used at other times during the
billing period.
Net Metering in New York
New
York's original net-metering law, enacted
in 1997, applied to residential photovoltaic systems up to 10 kilowatts
(kW). In 2002, the law was expanded (S.B. 6592) to include qualified
farms that generate electricity
from biogas produced by the anaerobic
digestion of agricultural waste, such as livestock manure, farming
waste and food-processing wastes. Farm-based biogas systems with a
rated capacity of up to 400 kW are
eligible to net meter. In 2004, S.B
4890-E (of 2003) further expanded the law to include residential wind
turbines
up to 25 kW and farm-based wind turbines up to 125 kW.
Utilities
will accept customers into the
net-metering program on a first-come, first-serve basis until the total
net-metered solar-electric capacity equals 0.1% of a utility's 1996
electric demand.* The limit on aggregate
biogas system capacity is 0.4%
of a utility's 1996 demand, and the limit on aggregate wind system
capacity is
0.2% of 2003 demand. Individual utilities may choose to
allow a greater limit in aggregate net-metered capacity.
For
solar-electric systems, farm biogas
systems and
small wind systems (10 kW and less), net excess generation (NEG) in a
given month is credited to the next month's bill at the utility's
retail rate. At the end of the annual
billing cycle, customers are paid
at the utility's avoided-cost rate for any unused NEG. However, NEG
from wind-energy systems larger than 10 kW is credited to the next
month’s bill at the state's avoided-cost rate. NEG
for these systems
will be purchased at the utility's avoided-cost rate at the end of an
annualized period.
The
New York Public Service Commission (PSC) has
developed uniform interconnection rules for net-metered systems. See
the PSC web site for more information, including a list of accepted
(type-tested) inverters.
In February 2007,
the PSC has approved a request by
Central Hudson Gas & Electric Corporation to raise the
limit on
aggregate net-metering capacity for PV systems in its service
territory. The PSC's decision increased
the limit by 50% -- from 800 kW
to 1,200 kW. Central Hudson's net-metering program was the first in the
state to approach its limit on aggregate capacity.
For more information on
net metering and interconnection requirements in NY visit the NYS Dept. of Public
Service Distributed Generation Page: http://www.dps.state.ny.us/distgen.htm
For
more information on net
metering and interconnection elsewhere in the US, visit the Database of
State Incentives for Renewable Energy: www.dsireusa.org
