In rooftop solar solutions, solar panels are placed on the roofs of commercial, industrial, or residential buildings to power various loads. Rooftop solar can be broadly classified into 2 different categories. On-grid systems, where the excess electricity generated is connected to the grid, and off-grid systems where the excess electricity is stored in batteries. In India, depending on the state and the customer’s connection type, the metering available to you might be Net Metering or Gross Metering.
What is Net-Metering?
Consumers utilize the power generated by the solar panels and surplus power is exported back to the grid. In case the customer needs power, when the solar system is not producing energy, such as at night, the customer can import power from the grid. In net metering, a bidirectional meter is used to calculate the total power exported and the total power imported by the consumer.
In the case of solar net metering, the tariff of power exported is the same as the power imported. At the end of the month, the total power exported to the grid and total power imported from the grid is calculated, and based on that calculation, the electricity bill is generated.
Understanding Savings with Net-metering
Let us consider, for example, a customer consuming 750 units per month and paying an electricity bill of INR 6750 at a tariff of Rs. 9 per unit. If the customer installs a 6kW system, the system will generate an average of 720 units per month.
After transitioning to solar, the customer will save his power bill on the 720 units being generated i.e., INR 6480 (720 units X Rs. 9 per unit). He/She also pays a reduced tariff on the additional 30 units he will be consuming due to changes in the slab. Considering the tariff rate as per the new slab will be Rs. 1.45, he will need to pay Rs. 43.50 only. The customer is saving Rs. around Rs. 6,700 by installing solar.
What is gross metering?
Unlike net metering, the consumer never utilizes the solar power generated as all of the power generated via solar panels is exported to the grid. The consumer has to import all of the power from the grid. Here, 2 different electric meters are used. One calculates the power imported, the other calculates the power exported. Also, the rate at which consumers export the power back to the grid is lesser (Decided by DISCOM’s) than the rate at which consumers import the power from the grid. And because of this tariff difference, the consumer is only able to lower its electricity bill but getting a ZERO electricity bill is out of the scope.
Understanding savings with gross-metering
Let us consider for example, a customer consuming 750 units per month and paying INR 6,750 electricity bill per month at a tariff of Rs. 9 per unit.
In case the customer installs a 6kW On-grid system generating 720 units per month With gross metering, the customer still has to pay the electricity bill for the total 650 units he consumed earlier i.e., INR 6750 (750 X 9). DISCOM / Electricity board will pay the customer for 720 units exported at a fixed rate e.g. 2,160 (720 X 3). So, the total savings is only Rs. 2,160 Gross Meter is not suitable for solar due to low payout and delays in reimbursement from the utilities for exported electricity.
Frequently Asked Questions
The process of tracking the energy generated as well as consumed in the solar panel system is called net metering. The billing is done concerning the units of energy consumed versus the units exported which is adjusted in the monthly bills.
Gross metering on the other hand is the billing that’s compensated against a fixed tariff for the total units generated.
The biggest disadvantage of net metering solar is it requires the owners to keep the exact track of the energy consumed. Thus, installing a tracker would be an expensive proposition for net metering.
Gross metering on the price side is a bit cheaper in comparison to net metering. Additionally, gross metering does not need that much regular maintenance setup for businesses.
One of the biggest downs with gross metering is the limited self-consumption benefits. This means you are likely to miss any excess solar-created energy outside your limit of consumption which might result in a higher power bill.
The biggest takeaway of net metering is its cost-saving credit system that allows points for extra power generation. This could be compensated for by cheaper monthly power bills.
The limits of net metering are issued by the state government. Each state may have different limitations.
The formula used for calculating the bill value in net metering is the difference between the total energy produced by the whole system and the energy consumed by the beneficiary. Everything extra can be converted to credit points.
Let us assume you are staying in an apartment with other residents and you have installed a solar panel on the terrace. When the panel is connected with net energy metering, your overall power consumption might be lower and the excess power is sent to the main power grid. This in turn allows for lesser electricity bills than your neighbours.
