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Net Metering Guide

📖 5 min read

Understand how net metering works, how exported solar electricity is measured, and how it can help reduce your electricity bill.

What is Net Metering?

Net metering is a billing arrangement for eligible grid-connected rooftop solar systems. It measures both the electricity you import from the grid and the surplus electricity your solar system exports to the grid.

Depending on your electricity provider's policies and applicable regulations, the exported electricity may be adjusted against your imported electricity when calculating your electricity bill.

How Net Metering Works

☀️ Solar Panels Generate Electricity

During the day, your rooftop solar panels generate electricity from sunlight. This electricity is first used to meet your home's power requirements.

🏠 Your Home Uses Solar Power First

Electricity produced by the solar system is consumed by your home before drawing any power from the electricity grid.

🌍 Excess Electricity is Exported

If your solar system produces more electricity than your home needs, the surplus electricity is automatically exported to the utility grid through the net meter.

🌙 Import Electricity When Needed

At night or during periods of low solar generation, your home imports electricity from the utility grid just like a normal electricity connection.

🔄 Net Meter Records Both Directions

The net meter measures both the electricity imported from the grid and the electricity exported back to the grid.

💰 Electricity Bill is Calculated

Your electricity bill is prepared according to the applicable regulations of your electricity distribution company (DISCOM), taking into account imported and exported electricity where permitted.

Import vs Export Electricity

⬇️ Import

Import means electricity that your home receives from the utility grid when your solar system cannot meet your total electricity demand.

⬆️ Export

Export means excess electricity generated by your solar system that is sent to the electricity grid after your home's energy needs have been met.

Simple Example

Item Units (kWh)
Electricity Generated by Solar 500
Electricity Used by Home 350
Electricity Exported to Grid 150
Electricity Imported Later 100

The final bill is calculated according to the applicable net metering rules and tariff regulations of your electricity provider.

General Eligibility

  • A valid electricity connection in the applicant's name or as permitted by the applicable regulations.
  • A grid-connected rooftop solar system installed according to the applicable standards.
  • Installation through an approved vendor, if required by your DISCOM or state policy.
  • Compliance with the technical requirements of the electricity distribution company.
  • Approval from the concerned electricity authority before commissioning.

Application Process

  1. Apply for a rooftop solar connection through your DISCOM or the official government portal, where applicable.
  2. Submit the required documents and technical details.
  3. Receive technical approval from the electricity distribution company.
  4. Install the rooftop solar system through a qualified installer.
  5. Request inspection and testing after installation.
  6. The DISCOM installs or configures the approved net meter.
  7. After successful commissioning, your system becomes operational under the applicable net metering regulations.

Benefits of Net Metering

  • Reduces monthly electricity bills.
  • Allows surplus solar electricity to be exported to the grid where permitted.
  • Improves the financial return on rooftop solar systems.
  • Encourages the use of clean and renewable energy.
  • Supports better utilization of solar power generated during the day.
  • Can shorten the payback period of a solar installation.

Important Things to Know

  • Net metering policies vary between states and electricity distribution companies.
  • Eligibility, system capacity limits, and billing methods may change over time.
  • Always check the latest regulations before installing a rooftop solar system.
  • Only approved equipment and installation practices should be used.
  • Follow all safety and technical standards specified by your DISCOM.

Frequently Asked Questions

What is the purpose of a net meter?

A net meter records both the electricity imported from the grid and the surplus electricity exported by your rooftop solar system.

Can every rooftop solar system use net metering?

Not always. Eligibility depends on the current rules of your electricity distribution company and the applicable government regulations.

Will my electricity bill become zero?

Not necessarily. Your bill depends on your electricity consumption, solar generation, export of surplus energy, and the applicable tariff and billing rules.

Can I install net metering later?

Yes, provided your solar installation meets the required technical standards and receives approval from your electricity distribution company.

Is net metering available in every state?

Many states support net metering or similar arrangements, but the rules, limits, and procedures vary. Always verify the latest policy in your state.

Useful Solar Tools

Net Metering Calculator

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