Net metering in New York is one of the best financial benefits of switching to solar energy. This program allows you to utilize the full value of the excess energy your solar panels produce at night or when it’s cloudy, for example, and in turn save on your electric bill. 

But unfortunately, policies and programs like net metering that support the growth of rooftop solar have been in flux across the country. For New Yorkers considering solar, be aware that the New York Public Service Commission (NYPSC) and Con Edison have been changing the state’s net metering program and will likely continue to do so in the future. Now is the optimal time to go solar and ensure you receive the full financial benefits.

What is net metering?

If you’re an NYC homeowner considering installing solar panels on a flat roof, questions like these may have crossed your mind: How do I store the energy my system produces? What happens at night when there’s no sun? 

If these questions are at the top of your mind, we have two words for you: net metering!

Simply put, net metering is a billing mechanism that allows you to store your solar energy as a retail energy credit to be used at a later date.

How does net metering work?

As a residential solar owner, you remain connected to the grid. When your solar PV system is installed, the utility company will keep track of how much energy your solar system is exporting to the grid. 

During the day, your solar system will likely produce a lot more energy than you’re actually using. All of that excess energy feeds back into the grid and Con Ed will compensate you for it in credits on your next bill. These credits will be used at night or during less sunny times of the year. 

In NYC, we’re very lucky to have 1-to-1 net metering, meaning your solar power is valued at the same rate as electricity supplied by Con Edison. It’s a 1-to-1 exchange of kWh exported to kWh credited on your account.

In this way, net metering in its current form could be considered a virtual battery. It allows you to utilize all of your solar production even when the sun isn’t shining. This is particularly appealing considering FDNY currently does not allow solar batteries in residential settings. Net metering ensures New Yorkers continue to benefit from all of the energy their solar systems produce.

solar net metering in new york city diagram
Net Metering allows you to utilize your solar production even when the sun isn’t shining.

Where to Find Your Electric Meter

After your solar array is installed, Con Edison will make a simple software change to your existing smart meter. This change enables Con Ed to track the amount of energy your system is exporting to the grid which allows the company to compensate you on your future electric bills.

If you live in a house, your meter could be located outside where the power lines come into the home, or inside, in the basement, garage, or other utility room. If you live in a multi-family building or apartment building, the meters for each unit may be grouped together in one location.

Consolidated Edison Company of New York

If you pay an electric bill in NYC, you’re probably aware of Consolidated Edison, or Con Ed for short. Con Ed is one of the largest utility delivery companies in the country, providing electric and gas service to all of New York City and Westchester.

As a solar customer, you’ll remain connected to the electrical grid. Although you’ll continue to receive electric bills from Con Ed each month, you’ll owe the company much less – thanks to net metering.

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Is there a difference between net metering and remote net metering?

Remote net metering was established in New York in 2011, enabling renewable energy generated by one system to be distributed among multiple utility accounts. This program allows farms and non-residential customers to use the energy produced by a designated “host” system in one location across their “satellite” accounts in other locations.

It is different from conventional net metering because it doesn’t apply to residential customers, and it distributes energy across multiple accounts as opposed to a single account.

Are there financial benefits to net metering?

Net metering helps you get the most bang for your buck when you go solar. Your net meter keeps track of how many kilowatt-hours your system produces and exports to the grid. The electric company only charges you for your net energy usage (energy consumption – energy production). 

Take this scenario for example:

In one month, your solar system produced 1,000 kWh, but your household only needed 500 kWh. Your solar system produced an extra 500 kWh more than you needed that month.

On your next Con Ed bill, you’ll get credit for those 500 extra kilowatt-hours. These will be reflected on your bill under “Net Meter Summary.”

The following month your solar system produces another 1,000 kWh, but your home uses 1,500 kWh. In this case, you’ll use the 500 kWh that you banked the previous month and you won’t be charged.

Net metering summary solar in nyc
Here’s an example of what your Con Ed bill would look like after going solar. Con Ed will provide a net metering summary, which compares your stored credits to your consumption.

When you make the switch to solar, net metering credits you for all the energy your system produces. Under the current program, the kilowatt-hours that your solar system exports are valued at the retail electric cost; in other words, as Con Edison rates rise, the value of the energy your system exports does too. It also ensures that energy is supplied at times when producing and acquiring energy is most costly, like at nighttime. For these reasons, net metering is one of the best financial incentives when it comes to going solar.

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Net metering not only benefits you as a homeowner, but the community and economy overall. It reduces the need for transmission upgrades or new generation and contributes to overall reliability and NYC’s climate goals

It also increases demand for solar energy. This creates jobs for the installers, electricians, and manufacturers who work in the solar supply chain. The solar industry currently employs 250,000+ American workers in large part due to strong state net metering policies which have allowed it to thrive.

What does the future of net metering look like in NYC?

For New Yorkers considering solar, be aware that Con Edison has begun changing their net metering program. Utilities in other states have recently been doing the same in order to address “cost-shifting.” Cost-shifts occur when utility companies claim they must charge their non-solar customers more money in order to make up for the revenue they lose from net metering.

Right now, New Yorkers who go solar will still receive 1-to-1 net metering and will be locked into that arrangement for 20 years. But as of January 1, 2022, residential solar customers will be charged a monthly Customer Benefit Contribution (CBC). The CBC charge is effectively a tax on solar, costing customers between $7-10 a month on their electric bills.

In the past, there have been talks of other changes as well, including a new solar billing structure called VDER. While this was put on pause due to the pandemic, there’s always a possibility of more changes going into effect. If you’re a homeowner considering solar, we encourage you to act now to lock in the current 1-to-1 net metering arrangement and avoid any uncertainty.

Will changes to net metering affect my investment in solar?

While the potential savings from the current net metering program will be reduced slightly by the CBC charge, it is important to know that the return on your investment in solar will not change significantly. Whenever you’re using energy from the sun rather than fossil fuels coming from the grid, you’re saving money.

Though payback periods may vary when factoring in these new changes, the investment in solar is still worthwhile – for yourself, your home, and the planet.

Go Solar Now to Avoid Uncertainty

Unfortunately, times are changing for solar policy across the country. From changes to net metering policies to additional charges for solar customers, plenty of uncertainty lies ahead. 

That’s why we urge New Yorkers considering home solar to move forward as soon as possible. By signing on now, you’ll avoid policy changes and be able to take advantage of New York State solar incentives at their peak.

Are you ready to flip the switch to solar? Schedule a Consultation
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