Net metering policies in the United States vary significantly from state to state, reflecting the decentralized approach to renewable energy adoption. Here are some key aspects of how net metering varies by state:
Key Variations in Net Metering Policies
- Types of Compensation:
- Retail Rate vs. Wholesale Rate: Traditional net metering often provides credits at the full retail rate for excess electricity generated, though some states, like California, have transitioned to net billing, crediting at wholesale rates.
- Avoided Cost vs. Feed-in Tariff: States like Oklahoma pay excess energy at the utility’s avoided cost, while Arizona uses a feed-in tariff structure.
- System Size Caps:
- Limits on the size of solar systems eligible for net metering vary. For example, Massachusetts allows up to 60 kW for certain technologies, while Wyoming caps at 25 kW.
- Aggregate and Virtual Net Metering:
- Some states offer aggregate or virtual net metering options, allowing credits to be applied across multiple meters or to benefit third-party entities.
- Statewide and Utility-specific Policies:
- Net metering can be mandated at the state level (e.g., Massachusetts) or offered by specific utilities within states without state mandates (e.g., Idaho, Texas).
- Transitioning Policies:
- States like California, Illinois, and Michigan are transitioning away from traditional net metering toward alternative compensation models.
Examples of State-specific Policies
- Hawaii: Replaced retail net metering with the “Customer Grid Supply” and “Customer Self Supply” options in 2015, focusing on energy storage as an alternative.
- Arizona: Transitioned from retail rate net metering to a feed-in tariff system, compensating solar generation at a lower rate than retail electricity.
- Massachusetts: Allows net metering for various generation technologies with caps based on the type of ownership and energy demand.
Current Status Across the U.S.
- 33 states and D.C.: Mandate net metering for certain utilities, though specifics vary widely.
- 5 states transitioning: California, Illinois, Indiana, Kentucky, and Michigan are shifting their compensation models.
- 7 states with alternative compensation: Arizona, Georgia, Hawaii, Louisiana, Mississippi, New York, and Utah use methods other than traditional net metering.
- Alabama, South Dakota, and Tennessee: These states lack state-level mandates but may have utility-specific programs.
Overall, net metering policies in the U.S. are dynamic, reflecting ongoing efforts to balance renewable energy integration with grid management and cost recovery across different states and utilities.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/how-does-net-metering-vary-by-state/
