Understanding Net Metering

Net metering in Maryland is a policy that allows solar panel owners to receive a credit on their electricity bill for the excess energy their panels produce and send back to the grid to power other homes and businesses.

Understanding how net metering works

This system helps businesses and homeowners recoup the upfront costs of installing solar panels and promoting renewable energy use. These regulations help ensure the electricity grid’s safety, fair billing, and efficient service.

Under this policy, solar panel owners have their meters measure the electricity they consume and the excess energy their systems generate. When the solar panels generate more electricity than is used, the excess is sent back to the grid, and the owner receives a credit on their bill for the energy they’ve provided.

Some critical aspects of the Maryland net metering policy include:

  • Solar power systems with up to 2 MW capacity are eligible.
  • Customers’ credit for their excess generation is typically equal to the retail electricity rate.
  • Maryland has also implemented meter aggregation provisions, allowing customers to receive credit for excess generation on multiple meters on their property.

Overall, understanding net metering in Maryland is essential for solar panel owners and potential adopters of solar energy, as it plays a significant role in the economics and spread of solar power usage in the state. By knowing the regulations and benefits, individuals can decide whether solar energy is viable for their households or businesses.

Net Metering in Maryland

Eligible systems must have a capacity of fewer than two megawatts (MW) or not exceed 200 percent of the owner’s annual baseline electricity usage.

Eligible Solar Systems in Maryland Qualify

The Public Service Commission of Maryland (PSC) plays a significant role in overseeing and regulating net metering in the state. This includes monitoring net-metered facilities’ capacity and making recommendations for any alterations to the eligibility cap. The PSC also monitors the local and national renewable energy issues to ensure that Maryland’s renewable energy initiatives align with overarching federal objectives.

In recent years, the cap for Maryland’s net metering program has been increased, with the commission updating the eligibility limit to 3,000 MW, effective October 1, 2021. This progressive move accommodates the growing demand for renewable energy installations while maintaining the state’s balanced distribution of energy resources.

One notable aspect of Maryland’s regulations is the Community Solar Energy Generating Systems program. This initiative aims to make solar energy more accessible to residents who cannot install solar panels on their property. By participating in community solar projects, individuals can benefit from the shared generation of renewable electricity and receive credits on their energy bills.

Net metering in Maryland is crucial in promoting the adoption of renewable energy resources, and the Public Service Commission is dedicated to ensuring that these programs and regulations adapt to the evolving energy landscape. This includes balancing promoting renewable energy generation and ensuring utility companies provide reliable electricity services to all Maryland residents.

The Role of Solar Energy

Solar Energy and Net Metering

Solar Panels

Solar panels, often installed on rooftops, are vital in converting sunlight into electricity. These panels can produce more electricity during daylight hours than a household or business requires. This excess power is then fed back to the grid, earning credits for the solar system owner.

  • Rooftop Solar: Property owners can efficiently generate clean energy without sacrificing land space by utilizing a rooftop solar setup. This setup is a practical and popular choice for residential and commercial properties.
  • Solar Renewable Energy Certificate (SREC): Maryland participates in the SREC market, which allows solar energy producers to earn and sell SREC credits for each megawatt-hour of electricity produced. These credits provide an additional revenue source for solar system owners and help promote solar energy adoption.

Solar Systems

Solar racking equipment installation

An effective solar system consists of solar panels, an inverter, and a net meter. The inverter converts the direct current (DC) power generated by the solar panels into alternating current (AC) power, which can be used to power homes and businesses or sent back to the grid in exchange for credits. The amount of electricity generated by the solar system will depend on factors such as:

  • The size and efficiency of solar panels
  • The angle and orientation of solar panels
  • The amount of sunlight available in the location

Solar systems can be customized to suit a property owner’s needs, and they offer various benefits, including:

  • Reduction of electricity bills due to NEM credits
  • Lower carbon footprint by harnessing clean, renewable energy
  • Increased property value as solar installations are an attractive feature for potential buyers

Maryland’s energy policies continue to support the growth and adoption of solar power. Solar systems, consisting mainly of solar panels and an inverter, allow property owners to produce clean energy while receiving credits for excess power generated and fed back to the grid. This creates incentives for adopting solar energy systems and contributes to a more sustainable and clean energy future.

Working on a Net Meter

The net meter monitors the amount of electricity produced and consumed, making it easier for the customer and utility company to account for energy usage and generation.

Utility checking the electric meter

When a customer in Maryland installs renewable energy systems like solar panels, the energy produced by these systems is measured in kilowatt-hours (kWh). The electricity generation can either meet the customer’s energy consumption or be sent back to the grid if there is excess generation. This is where the net meter comes into play.

The net meter records the electricity produced by the renewable energy system and the electricity consumed by the grid. It does this by measuring the flow of electricity in two directions – incoming and outgoing. The utility company then uses this information to calculate the net energy consumption for each billing period.

Suppose the customer’s renewable energy system produces more electricity than is consumed. In that case, the surplus energy, called net excess generation (NEG), is returned to the grid. On the other hand, if the customer’s energy consumption is higher than the electricity produced, the net meter will register the additional energy drawn from the grid.

Every month, the utility company will bill the customer only for the net energy consumption, which is the difference between the energy consumed and the electricity produced by the renewable energy system. This process allows customers in Maryland to save on their energy bills while contributing to a greener environment.

A net meter is crucial in helping Maryland customers monitor and offset their energy consumption with renewable energy production. The net meter records the kWh of electricity produced and consumed, assisting utility companies in accurately billing the customers ensuring that they are only charged for their net energy usage.

Billing and Net Metering

Happy net metering customer

Billing Process

The billing process for NEM customers involves receiving credits on their utility bills for any excess electricity generated by their solar panels. This excess electricity is sent back to the grid for use by others. To participate in net metering, the solar energy system should be sized to meet some or all of the customer’s energy needs. It can produce up to 110% of their most recent 12 months of energy usage.

The utility bill will show the net energy usage, which is the difference between the energy consumed and energy generated by the solar system during the billing period. If the solar system generates more electricity than the customer uses, they receive a credit on their bill.

Credits and Rebates

Net metering customers in Maryland receive credits applied to their utility bills at retail rates. To be eligible, customers must own or operate a solar energy system with a capacity less than or equal to 2,000 kW (AC-rated) for their own use.

In addition to net metering credits, Maryland offers tax credits and rebates to support the adoption of solar energy systems. The Residential Clean Energy Rebate Program is available to Maryland residents who install solar panels on their property. The rebate amount varies depending on the size and capacity of the solar system.

Maryland Solar Renewable Energy Credits (SREC)

Maryland offers various incentives and benefits to promote the use of solar energy. One such incentive is the Solar Renewable Energy Credits (SRECs) program. SRECs are created for each 1,000 kWh of electricity produced by a qualified alternative energy source, such as solar panels. The value of SRECs is measured in $/MWh (1MWh = 1,000 kWh), and their prices can fluctuate in the market.

SRECs in Maryland: Renewable Energy Credits

Maryland’s current Renewable Portfolio Standard (RPS) requires 14.5% solar, 2.5% off-shore wind, and 50% renewable energy by the end of the 2030 calendar year. To receive SRECs, a solar system must be registered with the Maryland Public Service Commission (PSC). By selling their SRECs, solar PV owners can generate additional income while still maintaining and enjoying the benefit of all the electricity produced by their system.

Additionally, Maryland supports net metering, which allows solar panel owners to receive full credit on their utility electric bills for the extra electricity their solar panels generate. When solar panels produce more power than the owner uses, the owner can “bank” the excess energy with the utility and draw from it later when more energy is needed. This system not only provides financial benefits but also encourages green energy production.

Furthermore, Maryland also offers the Residential Clean Energy Rebate Program, which provides financial assistance to homeowners who install solar panels or other renewable energy systems. This program further strengthens the state’s commitment to a greener future.

Maryland’s Solar Renewable Energy Credits (SREC) program, net metering policies, and Residential Clean Energy Rebate Program have created an attractive environment for residents to adopt solar and other renewable energy systems. These incentives contribute to the state’s goal of achieving 50% renewable energy by 2030 and ultimately transitioning to a more sustainable energy future.

Benefits and Incentives of Net Metering

Net metering in Maryland offers numerous benefits and incentives for homeowners who want to go solar. These benefits and incentives include financial savings, environmental benefits, and increased accessibility to clean energy.

Environmental benefits of net metering

One significant advantage in Maryland is the opportunity for homeowners to lower their energy bills. Net metering allows residents to generate electricity through solar power and offset their energy consumption. According to Solar United Neighbors, at the end of each 12-month billing cycle, utilities compensate net-metered generators for any excess credits at the average annual commodity electricity rate for their utility or electricity supplier.

Another financial incentive for Maryland residents with solar power systems is the Solar Renewable Energy Credit (SREC) program. SRECs are tradable certificates representing the environmental attributes of one megawatt-hour (MWh) of solar energy production. Homeowners with solar systems can sell these SRECs to electricity suppliers, creating an additional income source and further offset the cost of solar installations.

In addition to SRECs, Maryland residents can benefit from the Residential Clean Energy Rebate Program. This program offers rebates to eligible homeowners installing solar photovoltaic (PV) or solar water heating systems. The refunds help make clean energy more accessible and affordable for Maryland homeowners, encouraging the adoption of solar power and the growth of the renewable energy industry.

Installation of solar power systems is not only beneficial for homeowners in terms of cost savings, but it also contributes to environmental conservation efforts. By generating electricity with solar panels, residents can reduce their reliance on fossil fuels, lower greenhouse gas emissions, and contribute to cleaner air and water. Furthermore, it supports the state’s commitment to increase renewable energy use and decrease dependence on nonrenewable energy sources.

Overall, there are significant benefits and incentives for homeowners. These include financial savings through lower energy bills, incentives like SRECs and the Residential Clean Energy Rebate Program, and environmental benefits from using clean energy. By taking advantage of these incentives, more Maryland residents can participate in the growth of solar power and contribute to a cleaner, more sustainable future.

Net Metering and Utility Companies

The NEM program is regulated by Maryland’s Public Service Commission (PSC). It is available to customers of Maryland utility companies such as BGE, Pepco, Delmarva Power, Potomac Edison Company, and SMECO.

Maryland's big utility companies

To participate in net metering, customers must have an eligible solar energy system sized to meet some or all of their energy needs but only produce up to 110% of their most recent 12 months of energy usage. Plans should be less than or equal to 2,000 kW (AC-rated) for private use. When customers generate more electricity than they consume, the surplus is sent back to the electric grid, and they receive credits on their utility bill.

Each utility company may have specific conditions and regulations for NEM participants. For instance, BGE provides detailed information and FAQs on its Green Power Connection program. Similarly, Easton Utilities does not charge customers for net meter installation and offers a standard interconnection application process.

It is important to note that the total capacity of net-metered systems in Maryland is capped at 1,500 MW, as mandated by the PSC. Therefore, customers are encouraged to participate as soon as possible to secure their spot in the program.

Overall, net metering in Maryland offers an excellent opportunity for solar energy system owners to offset their electricity costs and contribute to greener energy production. Customers can reduce energy bills by participating with their respective utility companies while promoting sustainable energy solutions.

Excess Generation

Customers who generate electricity via solar panels to connect to the utility grid also receive credits for the excess electricity they produce. The regulations and rules for net metering in Maryland are established by the Maryland Code §7-306 and COMAR 20.50.10.

Excess electricity generated goes back into the utility grid

Excess electricity refers to the energy produced by customer-owned solar systems beyond what they personally consume. The net excess generation is calculated by subtracting the electricity consumed from the electricity produced. This excess electricity is then delivered to the utility grid, where other customers can use it, and the customer-generator receives monetary credits for contributing to the grid.

In Maryland, there is no limit to the amount of electricity a utility can credit to a customer. This allows customer generators to accrue these credits and use them to offset future energy bills until the annual April reconciliation. According to the Net Metering Flexibility Act, eligible customer-generators can accrue net excess generation indefinitely.

To be eligible for net metering in Maryland, systems must have a capacity of less than two megawatts (MW) or 200 percent of the owner’s annual baseline electricity usage. In 2021, the state cap for net metering increased from 1,500 MW to 3,000 MW, allowing more customers to use this renewable energy incentive.

Metering homeowner’s net electricity production promotes the adoption of renewable energy sources and helps customers reduce their electricity bills. Maryland’s excess generation and net metering policy provide a supportive environment for the solar power industry’s growth and contribute to the state’s goal of promoting clean and sustainable energy.