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Interconnection and Net Metering
While interconnection and net metering policies are often discussed together, it is important to distinguish the issues. Interconnection (and related standards) refers to the technical and practical aspects of connecting the solar generator to the grid. Net metering (and related policies) is a method of billing and crediting the power consumed and produced.
While state laws govern what is allowable under interconnection and net metering policies, ultimately each utility establishes their own procedures and tariffs, with their own Net Metering Agreements and Interconnection Agreements. Therefore, it is important to contact the utility for the precise procedures.
Net Metering
Net metering laws establish how a set of utilities must treat the power produced by a grid connected system. Under a net metering agreement, electricity that is fed back into the grid is credited at the full retail rate (the same retail price the customer pays for power they consume from the grid). Thus customers who produce some or all of their power on-site from solar energy only pay for their net energy consumption during a set period. System eligibility and procedures for handling net excess generation across billing periods vary by state and utility net metering policies.
There are different ways to handle the metering of Community Solar projects. The definition of Community Solar that we use here includes multiple contributors/participants per a single solar system. These systems typically use a single meter.
A simple strategy for metering would be for the site host to net meter the power generated. The site host (such as a school or community center) where the solar array is installed would thus see the energy savings on their bill. The energy could either be donated to the site host or sold through some other financial arrangement. The contributors to the system would then not receive any credit for the power generated, but may receive other benefits such as incentive payments, tax-deductions, and recognition for the contribution.
Virtual Net Metering
A newer approach to for Community Solar projects to leverage net metering is to establish a "Virtual Net Metering" system. In this model the owner/manager of the solar array would track the energy production per individual share of the system. If the utility is managing the system, they could credit participants' energy bills for their portion of solar production just as they would for individually-metered systems.
Technical Aspects of Interconnection
The relatively small size of PV projects makes the process of connecting them to the utility grid relatively simple in many cases. However, while the technical aspects may seem straightforward, particularly to an experienced solar contractor, the procedural differences between utilities, states, and interconnection type can be confusing.
Since community solar projects can take on many forms, including one or more installations, the interconnection issues for small-scale applications can be applied to community solar projects as well.
Technically, small-scale PV projects are the easiest to interconnect safely to the grid. Any reputable dealer/contractor will provide PV customers with a system design that meets regulations. PV system parts that are directly related to interconnection include:
- the DC to AC power inverter
- disconnect switches (often a DC disconnect switch between the PV array and inverter and an additional lockable AC disconnect switch)
- distribution panel (a.k.a. circuit breaker box)
- meter (includes the building’s electric service meter and possibly an additional production-side meter).
A grid-tied PV system that includes battery backup will have additional interconnection components.
The vast majority of PV installations, considered to be on-site distributed generation, will interconnect to the grid at the point of service. A simple one-line diagram shows the flow of power from PV array to building load, or back into the grid. Often the setup is referred to as a net metered system, but the technical design is actually the same whether the billing arrangement is for net metering or not.
For a thorough examination of procedural and technical interconnection issues visit the Interconnection section in Utility Considerations for:
