Interconnection & Netmetering Considerations

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Interconnection

Interconnection

The majority of solar systems are “grid-tied” solar array.  This means the solar system can potentially send electricity to the utility grid when your home or farm is using less power than you’re generating.  When we install solar on your property we will “interconnect” the system on your side of the meter.  As a new owner of a small power plant connected to the grid, you must follow the “interconnection” guidelines provided by your local electric utility.  A basic residential interconnection diagram shown below illustrates this setup.

Netmetering

Netmetering

Netmetering is a great incentive that your electric utility may offer.  The purpose of the netmeter is to measure power “delivered” (DEL) to your house or “received” (REC) by the utility from your solar array.  At the end of the month,  excess kWh credits are used to offset power delivered to your house.  The “net” power delivered to your house forms the basis for calculating your electric bill for that month.

At the end of the month, if you generated more power than you consumed, excess kWh credits carryover to the next month.  The monthly carryover then continues month after month.  Depending on your utility, excess credits expire at the end of each quarter, bi-annually, or annually.  Some utilities may pay for any end of term excess but many have a “use-it or lose-it” policy and no value is provided.

Other Netmetering Policy Variations:

Other Netmetering Policy Variations:

Utilities often have a size limit for offering netmetering.  In the Midwest, many rural electric cooperatives have a limit (e.g. 20 kW AC) where solar or wind systems below the defined limit are eligible for netmetering.  For systems larger than the defined limit, any excess power produced at the end of one month is typically paid at the utilities avoided cost of power.  The utility’s avoided cost is often the wholesale rate of electricity and excludes their cost of transmission and distribution (T&D charges) and their overhead costs.  The avoided cost rate is typically about 1/3rd the full retail case.

Netmetering & Solar Sizing Strategies

 

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Netmetering & Solar Sizing Strategies

Netmetering policies will typically define a project size where netmetering is eligible.  For example, netmetering may be only available for systems 10 kW and below.  Keep in mind that is 10 kW AC and not DC.  Solar produces direct current, or DC, and the inverter changes the DC power to alternating current, or AC.  The utility company only cares about the AC output and AC output is governed by your inverter’s rating.  For example, a 12 kW (DC) solar array connected to an inverter with a rated AC output of 10 kW (AC) would qualify for a netmetering policy with a 10 KW limit.  Other utilities may not have a limit, or may allow much higher capacity installations.

There are various electrical losses as power is converted from DC to AC.  From your solar array to inverter, overall losses can range from 9 to 15% depending on the efficiency of your equipment, quality of your electrical installation, shading, snow cover, electrical equipment mismatch, and other factors.

There are many variations in netmetering policies from utility to utility.  Netmetering can also be a confusing matter.  Many solar companies don’t have a good grasp of these policies and their estimate of return on investment (ROI) could be misleading or incorrect.

At Tick Tock Energy, our experts will help you understand your utility’s policy and optimize your investment.  We handle the entire interconnection and netmetering application process and make it easy for you.

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