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Net Metering and Interconnection

What is net metering?
How does the Illinois net metering program work?
What equipment do I need?
Do I have to buy a new meter?

How much money can I save?
How do I earn energy credits through net metering?
What should I know before I install a system?
Net Metering Resources



Q. What is net metering?

A. Net metering is a way to capture the energy used and produced by a renewable energy generator located at a home or small business. Homeowners and small business owners who have a solar power system or a wind turbine can use net metering to offset their traditional utility costs while using cleaner energy.

Q. How does the Illinois net metering program work?

A. The Illinois net metering program began April 1, 2008. Commonwealth Edison, the Ameren Illinois Utilities, and MidAmerican Energy Company must now offer customers credits on their electric bills for electricity generated by renewable energy systems. Applications for the program are accepted on a first-come, first-serve basis.

Under Illinois rules, eligible renewable generators of 40 kW or less receive a one-to-one retail rate credit. These customers will be compensated for excess electricity generated by their renewable energy systems at the same rate that they pay when buying electricity from their utility. These credits will be carried over month-to-month, with the annual period running from May to April, or November to October, at the customer's discretion.

Customers with eligible renewable generators between 40 kW and 2 MW will receive credits equal to the utility's avoided cost for their excess generation. However, customers who are "time of use" customers are compensated at time-of-use rates.

Q. What equipment do I need? go to top of page

A. Residential and small business customers typically invest in either a solar (photovoltaic, or "PV") system or a wind system.

Solar Electric Systems
Solar electric systems generally consist of photovoltaic panels installed on a building's roof to capture energy produced by the sun. These systems are most productive during the summer, but they can still generate electricity during the cloudier fall and winter seasons.

The size and complexity of solar electric systems vary, but most residential systems have a capacity between 1 and 5 kW. These systems deliver an average of 1,200 to 1,300 kW hours of electricity for every kW of capacity. A 2 kW solar power system would cover an average of one-third of a typical household's electricity use.

Wind Systems
Wind systems typically consist of individual turbines and vary widely in size and height. While they have the potential to deliver up to 2,000 kW hours of electricity for every kW of capacity, how the system is placed is important to estimating how much electricity will be generated.

Q. Do I have to buy a new meter? go to top of page

A. Residential customers can use a single, bi-directional meter, which will be provided to them if their current meter cannot record the electricity generated on-site. Customers who use generators with a nameplate rating of 40 kW and below can obtain a dual-channel meter from their electricity provider. Customers with a larger system must purchase the dual-channel meter on their own.

Q. How much money can I save? go to top of page

A. Annual savings estimates depend upon the amount of electricity that the customer uses and the amount of electricity that the customer generates. Most net metering customers will receive energy credits for the electricity their system generates. All such customers must pay certain fixed costs to connect to the electric grid and, of course, must also pay their public utility for any electricity they use and can't offset. Each public utility charges different amounts for service, so check with your utility to determine your costs.

Here are two examples that provide an idea of how much a net metering customer
might save:

A residential solar panel system in the Commonwealth Edison service territory can offset an estimated 32% of annual consumption.

  • Estimated Total Charges Offset by PV Installation = $248
  • PV System Size = 2 kW (DC), or 1.54 kW (AC)
  • Estimated Annual Consumption = 7,600
  • Estimated Annual Production = 2,458 kWh AC

A small business wind turbine system in the AmerenIP service territory can offset an estimated 55% of annual consumption.

  • Estimated Total Charges Offset by PV Installation = $2,950
  • Wind System Size = 10 kW
  • Estimated Capacity Factor = 27%
  • Estimated Annual Production = 23,652 kWh
  • Estimated Annual Consumption = 43,076
Q. How do I earn energy credits through net metering? go to top of page

A. Customers can earn energy credits as follows:

  • Customers with eligible generators of 40 kW or less will receive a one-to-one retail rate credit for their excess generation.
  • Customers with eligible generators between 40 kW and 2 MW will receive credits equal to the utility’s avoided cost for their excess generation. The utility’s “avoided cost” is the cost the utility would have paid to purchase the electricity from another source if the customer hadn’t provided it.
  • Customers with service under time-of-use rates will receive net metering credits at time-of-use rates.
  • Credits will be carried over month to month, with the annual period running from May to April, or November to October, at the customer’s discretion.
  • Each utility must offer net metering up to 1 percent or more of their previous year’s peak demand.
Q. What should I know before I install a system? go to top of page

A. Before you install a net metering system, it is important to ask the following questions:

  • Are there tax incentives or rebates for installing a renewable energy system available in your area? To find out, check DSIRE, a database of Illinois tax incentives for renewable energy.
  • Are there zoning laws or building ordinances that restrict what kind of system you can install in your area?
  • Are there licensed contractors in your area to install the system you want?
  • What is the process for connecting your system to the local electrical grid?

Resources:

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