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If you’re researching solar power for your home in New York, one of the first things you should understand is net metering. What’s interesting is that it is one of the key policies why solar is such a financially smart move but it’s also commonly overlooked and underappreciated aspect of how solar works in New York.
In short, Net Metering is a crediting system put in place for homeowners who produce their own energy with solar power. When your solar panels produce more energy than you are using at any given time, that energy needs to be sent somewhere or else the energy would be wasted. Until recently the only option was to store that energy in costly and inefficient battery systems. But with net metering, your electric company will credit you for every kilowatt-hour (kWh) of energy your system overproduces and sends back to the grid.
Some states have more favorable Net Metering programs than others and it’s important to know how you will be compensated for your system’s overproduction and how long you’ll be grandfathered into the current net metering program. The good news is that New York homeowners have access to the most generous Net Metering programs in the country. However, state regulators have proposed a new crediting structure that could reduce the value of excess solar energy, and changes may take effect soon.
Why Net Metering Matters
Without Net Metering, homeowners would need to invest in expensive battery storage to save their unused solar energy. Most homes would require several batteries, adding an extra $20-30k on top of the cost of going solar.
Net Metering solves that problem by allowing homeowners to send excess power back to the grid and draw from it when needed, without losing the value of what they produced. It keeps the system simple, affordable, and efficient. Not only does Net Metering keep the cost of going solar affordable, but it turns a very complicated topic into a simple and easy to understand process.
What Is The Current Net Metering Program In NY?
Right now, New York uses 1:1 net metering, one of the best Net Metering programs in the entire country. While some states like California only allow homeowners to benefit from a small percentage of their overproduction, New Yorkers get one to one Net Metering.
What does “one to one” Net Metering mean?
It means every unit of power you overproduce, you get to claim as a credit to be used when your panels produce less than what you use. These credits can be stored and used at night and they can even be rolled over month to month. This allows New Yorkers to store their Net Metering credits from the spring and summer and carry them through the fall and winter when the sun isn’t providing enough energy to power their home.
Think of it like this: the grid becomes your battery. You pay a small monthly fee, which will vary from one electricity provider to the next, to upload your overproduction and in return you can upload your overproduction to be stored for when you need it most.
How Long Am I Enrolled in Net Metering?
At the time of writing this article, New Yorkers who install solar panels for their homes will be grandfathered into the current net metering program for 20 years. That means even if net metering policies change in the future, homeowners who enroll now are guaranteed to benefit from 1:1 net metering. This provides New Yorkers with peace of mind and complete assurance that they will benefit from solar for decades without any changes to their relationship with the grid.
Upcoming Changes To Net Metering: VDER/ Value Stack
Although the official date is undetermined, New York State has announced that they will be slowly phasing out the current Net Metering program and replacing it with what is known as VDER, which stands for Value of Distributed Energy Resources.
Instead of giving you a 1:1 credit for the energy you send back to the grid, like net metering does, VDER calculates the value of that energy based on several different factors which are also known as the Value Stack.
So what exactly is in the “stack”?
- Energy Value – The base value of the electricity your system produces
- Capacity Value – How much your system helps reduce stress on the grid during peak demand
- Environmental Value – The benefit of producing clean energy instead of fossil fuels
- Demand Reduction & Locational Value – How much your solar helps the grid based on when and where your energy is produced
To summarize, VDER is a much more complex way of giving a value to solar energy, and it varies greatly depending on your location, your utility, the time of day your system produces power, and more.
What Does This Mean for New York Homeowners?
While VDER was designed to better reflect the true value of solar, it’s harder to predict your monthly credits and in many cases, it may result in lower savings than traditional net metering. For that reason, many homeowners still prefer the simplicity and predictability of the current net metering system.
The good news is if you install your solar system before New York fully transitions to VDER, you can still be grandfathered into net metering for 20 years. That’s why now is such a critical window to make the switch.
Do I Still Have Power During An Outage?
A common misconception about grid-tied solar systems is that when the power goes out, the panels will still produce energy. Unfortunately, this is not the case. When the grid shuts down, so do the panels. This is a safety measure required by your utility to protect utility workers who may be repairing the grid lines. If solar panels were sending energy back to the grid during an outage, it could send that electricity back to an area that is being repaired and cause serious harm to someone.
Net Metering does allow you to “store” your energy but not in your home. Instead of using actual batteries it’s more like getting “store credit” with your electric company.
How Do I Know I Will Produce Enough Energy?
When your system produces more energy than you’re using, that energy is tracked by a new “net-meter” your utility company installs on your home. This net meter tracks not only how much energy you use but how much energy you “upload” to the grid. When your panels don’t produce enough energy to power your home, you pull from your credits before your electric company can charge you for sending you electricity.
Our goal is to produce enough energy to offset 100% of your electricity needs with solar. We do that by analyzing your electric bills and calculating how much energy you use in a year. Once we have an understanding of your unique energy needs, we design a system to offset 100% of your annual usage or more.
In practice, if your panels produce all of the energy you need, you’ll overproduce energy from the early spring all the way until the end of fall. As you build credits, they roll over from one month to the next and continue to build up until the winter when the days are shorter.
In the event that your panels don’t produce enough to power your home all year, that’s perfectly normal. In fact, many of the homes you see with solar panels are getting 30-70% of their annual usage covered by their panels. And that’s still a win. Even with a partial offset, you’ll save money because every bit of power your panels generate is power you’re not buying from the utility.
How Do I Set Up Net Metering?
Good news: we do it for you. When you go solar with Empire Solar, we take care of the entire net metering application for you. From submitting paperwork to the final interconnection applications, we handle every step of the net metering application process.
Here’s how it works:
Once your solar project is designed and approved by an engineer, we submit all the necessary documents to your electricity company on your behalf. This includes your system specifications and the specific net metering and interconnection documents for your electric provider.
Before the system is turned on, your electric company will come out to install a bi-direction “net meter” which will track the energy you use and log the excess energy your system is sending back to the grid. Some homes already have net meters installed as a way for electric companies to prepare the grid to receive more renewable energy from homes and businesses in local communities.
After your power company gives us permission to operate (PTO), your system is activated and net metering goes into effect immediately. From there, you’ll start to build credits as your panels produce more electricity than you use, and you’ll pull from those credits during times of high demand.
It’s a very simple process, but only because we’ve helped New Yorker homeowners go through each of these steps thousands of times.
Final Thoughts
Net Metering is one of the most important reasons why solar works so well for New York homeowners. It gives homeowners a straightforward way to maximize their savings year round without needing an expensive battery setup.
But this opportunity window won’t last forever. New York is preparing to phase out Net Metering and in its place will be a new system that is far less predictable. If you want to get the most savings with solar and lock in 20 years of guaranteed savings, right now is the time to look into making the switch.
If you want to learn how much you can save with Net Metering, book a call with one of our Energy Advisors. We’ll design a custom solar installation and show you exactly how the system will look like on your home and how much you can save with Net Metering. Schedule Discovery Call ➞
