Are you looking to earn a significant income with solar power? Yes, residential solar panels help you earn through net metering. With solar power systems, you can avoid using expensive grid electricity. In addition, you can sell the excess solar energy back to the grid to earn passively.
A well-installed solar panel is capable of producing Solar Power substantial energy, more than a household’s or business’ requirement. Residents who have installed solar energy systems can opt for the net metering program. This program enables residents to offset a part of their electricity bills and save around 30% to 40% on them. Let’s understand how.
1. Understanding Solar Buyback Programs
Solar buyback programs allow you to sell excess solar energy generated from your residential solar panels. It involves connecting your solar energy system to the grid. This process is called net metering. It has a special meter which measures the energy you consume and produce. If your energy production is more than what you use, you earn energy credits. These credits help you lower your electricity bills.
Net metering rates may vary depending on your location and DISCOM. Full retail rates or lower depending on your area and the corresponding grid company. Some companies allow you to carry forward unused credit, while some reset to zero. Some might settle the credits annually and pay for any balance credits, while some may not. There might be a cap on the total amount of energy that can be credited.
You must study all these policies and rates to understand how much you benefit financially after setting up your solar energy system.
2. Steps to Selling Excess Solar Power
Let’s look at the steps to sell your excess solar power.
Installation of a Solar Power System
The first step is to install solar panels on your roof that suit your energy requirements and available rooftop space. It’s up to you to install a larger system if you do have a larger space and the budget to invest. The larger the system, the larger will be the energy generation and the bigger will be the profits.
Net Metering Agreement
On successful installation and commissioning, you need to sign an agreement with your corresponding DISCOM. The agreement allows you to sell your excess solar power to the grid. It also mentions the rate at which you will be selling the solar energy to the grid.
System Monitoring
Monitoring the system is essential to run the system consistently. You can use the Frey Energy app that helps you monitor and address the issues in time to prevent them from going dysfunctional.
3. Benefits of Selling Solar Power
Selling solar power is not only profitable but also a noble obligation.
Financial Incentives
Once you install roof solar panels, you use less grid energy, which is highly expensive. Using this expensive energy less, means you reduce your electricity bills. In addition, you earn by selling the excess solar energy you sell to the grid.
Environmental Impact
Solar panels use sunlight to create energy. It doesn’t use toxic materials which emit poisonous gases in the air during electricity generation. Thus, solar energy is clean and helps the environment, reducing tons of carbon footprint.
Grid Stability
The electricity demand is rising in progressive India. Solar power can help mitigate this demand and provide the required electricity to every unit, and every sector, thereby maintaining stability and preventing frequent power brakes or overloading.
4.Potential Earnings and Cost Savings
Factors that influence earnings
- System Size: Larger systems generate more power and help you earn more.
- Energy Rates: If your region has high electrical rates, you can save more and earn more.
- Net Metering Policy: If the policies from the net metering agreement are in your favour and the rates are good, you can boost your profits.
Reducing Electricity Bills
You get credits if your solar installation produces more energy than what you consume. These credits reduce your electricity bills.
Long-Term Cost Savings
Solar energy saves you from rising grid electricity costs. The government offers solar subsidies and tax incentives to help most people adopt solar energy. In addition, the value of your solar-installed property appreciates to a higher value.
5. Challenges and Considerations
However, challenges are a part of life and selling solar power is no exception.
Interconnection Process
It is not simple to connect your solar power system to the grid. Complexities involve obtaining several permits and going through inspections. In addition, it also needed to adhere to safety protocols and local regulatory compliance.
Grid Compatibility
The existing grid may not be compatible to handle the energy distributed from your solar energy system. These may be time-consuming and can be expensive. That’s why it is essential to ensure compatibility to ensure efficient energy transfer.
Policy Changes
Policies keep on changing, and so do the incentives. These changes may impact your future profits. Keep informed about policy updates to maximise returns.
Maintenance and Performance
To keep earning from your solar energy system, you must keep it free from troubles by maintaining it regularly. These involve cleaning panels, checking inverters and monitoring performance at regular intervals, if not daily.
Conclusion
Installing a solar energy system isn’t just an investment, but can help you earn in the long run. With a net metering program, you can sell your excess solar energy to the grid. Solar energy reduces your reliance on expensive grid electricity. Solar energy also provides continuous electricity and supports the environment.
Go solar today to avail of the government solar subsidy and save a huge amount on your electricity bills. Search solar power companies near me and select the best one to start your solar energy production.
Frequently Asked Questions
Net metering programs connect your solar energy system to the grid. It measures how much energy you produced in excess which was sent to the grid. In return, you receive credits which are used to offset a part of your electricity bill amount.
You must opt for the net metering programs and sign an agreement with the state DISCOM. Then your solar energy system is connected to the grid and sell your excess solar energy to the grid.
After commissioning your solar energy system, you can apply for net metering. On successful agreement, your system gets connected to the grid.
A specific value cannot be evaluated, as it depends on various factors, such as compensation rates, grid electricity rates, energy consumption etc. On average, based on the reports, you can earn about 30% to 40% of your regular electricity bills.
Businesses that install solar energy systems can claim 40% depreciation in the first year under Section 32 of the Income Tax Act. Solar energy-producing companies can enjoy an income tax holiday for 10 years under Section 80-IA. Other benefits include GST rates at 5% for solar installation and capital subsidies. The government also offers property tax rebates where a solar energy system is to be installed.
You can monitor and track excess solar power through the following:
- IoT-based solar power monitoring system
- Smart meters and inverters
- Net metering data
- Energy monitoring software
