Edison Net Energy Metering Credit – NEM

Setting up your home with solar power can help reduce both your energy bills and your carbon footprint leading to a greener and cheaper cost of living. Over recent years, any energy generated that was directed back to the grid would result in a financial payment or credit. However, as of June, 31st 2017 at 11:59 pm Edison will no longer be giving credits to people who generate extra energy via solar power that gets pushed back into the grid. This credit is known as the NEM, or Net Energy Metering Credit.

Net energy metering monitors your solar energy production and any energy pushed back into the grid will result in a credit on your bill. The more energy created the more credits earned resulting in a huge reduction of bills and in some instances the earning of money. The NEM will be closing to new customers from this date and time, those who have registered before the cutoff will be eligible for credits.

Installation of solar panels is a quick and painless one and allows the homeowner to generate solar power to provide eco-friendly and economical energy to the home. Generating your own power does have its own set of perks, with the Net Energy Metering Credit being one of the best. When you are using NEM the metering can monitor the flow of energy in two directions, the inflow to the home and the outflow to the grid. This is how credits are calculated and then added to your bill helping reduce energy consumption costs.

As of July, 1st or before if the NEM1 program reaches its cap of 2,240MW, whichever comes first the program will close. This means that to be eligible to receive credits you need to become a registered member by this point in time. All required documents must be completed and submitted in full, failure to do so will make you ineligible for the program. Once NEM1 has reached its cap the current tariff will close and only be available to those who were a part of the program before the cut off time, its successor NEM2 will begin with its own set tariff.

While this can seem confusing, it is quite a simple process. If you are considering having home solar panels installed and are worried about the initial cost then you may be surprised to learn that certain people are eligible for a 30% federal tax credit. For residential solar panels, there are also the options of finance and leasing. Leasing your solar system can help reduce costs and make maintaining the systems much more affordable as they, in essence, belong to a company or another individual, you can’t receive the 30% federal tax credit on a leased solar system. The cheaper alternative is to take out a loan which you can make monthly repayments on and can save you up to 29% when compared to leasing your solar energy system

There are many solar companies that can source and install your solar panels. Hiring a company for solar panel installation means that you can rest easy knowing that they are being secured and placed in the correct manner. Of course, if you have knowledge or experience of them you could install them yourself, but it is best to leave it to professionals to minimize the risk of damage to your equipment or home. Solar panels costs depend on the type and quantity that you have installed. It is important to remember that solar energy can drastically reduce your energy bills and earn you credits which ultimately mean that they will pay for themselves over the long term. Solar panels are no longer as expensive as they were in the not so distant past. In fact, with more competition from around the globe in the solar energy market there have been some reductions in costs of manufacturing and purchasing making the green option a much more affordable one. Gone are the days when solar energy was the reserve of large corporate companies and retail outlets. It is now an accessible and easily installed option for every type of homeowner, no matter how large or small your property is.

NEM2 will have the following conditions attached that are not a part of the NEM1 program. For a start, the interconnection fee that is waived in the NEM1 programme will cost $75 for systems of 1MW-AC or below, or $800 for systems above 1MW. There will also be a mandatory TOU Rate (Time of use rate) meaning that you must use energy at set periods of the day to benefit from any savings. While you could save money on the TOU rate, depending on your daily schedules and general energy usage you could find your bills increasing instead of decreasing. If you already own solar panels or produce solar energy, now is the time to make sure you are registered for the NEM1 Program.

This is why it is important to ensure that you have completed registration for the Net Energy Metering Credit by June, 31st at 11:59 pm. If you want to benefit from going green and make sure that you are entitled to credits then you need to move quickly. After all, the credits you earn help reduce the costs you pay for solar panels thus make them an affordable and profitable option. Solar energy is the way forwards and it is vital to make sure that you have everything in place by this date to be able to take advantage of this benefit. Failure to do so results in the potential loss of any credits you may have been able to gain and reduces the cost effectiveness of solar panels.

Solar panel can make a huge difference to your everyday energy consumption by making you more aware of the energy you use and the energy you can push to the grid in exchange for credits, it is also environmentally friendly and unobtrusive when installed. Act now to ensure you get to reap the rewards of any solar energy you produce. If you don’t then the only loser in it all is you.

solar panels

Solar Panel Purchasing Options 2017

save money with solar

Solar Panel Purchasing Options

So you’ve decided to make the switch to solar power. You know that solar energy saves you a lot of money on your electric bill, and is considered to be much better for the environment since it’s a renewable resource. You’ve probably thought long and hard about whether you are willing to take the step and invest in solar power, but have you considered your purchasing options?

There are a great number of options available. The normal choices like buying, and leasing are the most common. But what are the exact financing options available to you, and how do they compare?

What You Need To Know First

Before you delve into the different ways you can finance your new solar energy system, let’s take a quick look at how to figure out if you really want to do it. When you evaluate the cost of energy to see if purchasing a system will save you money, you’ll take a look at your electric bill. A common mistake is that people don’t know which part of their bill to look at. The only part of your bill which will be reduced are the components priced per kWh. This acronym ‘kWh’ stands for Kilowatts per hour.

Read all of the contracts presented to you carefully and completely. Every homeowner’s situation is different, and only you are fully capable of discerning which option is best for your personal circumstances.

It is also a wise idea to speak with your tax advisor prior to making any final decisions. They can discuss with the tax implications associated with the various purchase options. It is important for you to understand these prior to entering into a solar contract, so that you don’t have any surprises later on.

solar maintenance solar panels

Option #1: Own, Loan, Refinance

If you take this route, then you are paying for the system up front. This includes the purchase of equipment, and cost of installation. This can be done in a few different ways. The first way is to pay for your system in cash, which is really the best option. Unfortunately, the average Joe doesn’t have a ton of money laying around, so there are very few who can go this route.

The other options include borrowing from our sources to pay for the solar energy system. This could include taking out a loan, opening up a line of credit, or refinancing your home. Although you will own the system outright with these options, it is important to realize that you will have monthly payments after the fact. Make sure you are able to pay these prior to taking out a loan.

The US Department of Housing and Urban Development, better known as HUD, offers loans for Home and Property Improvement. They also have useful information on how to finance your home improvement.

Also keep in mind that since you own the equipment, you are responsible for it’s operation and maintenance. For this reason, you may want to think about entering into a service agreement with a trust company for maintenance and repairs on your system.

Option #2: Leasing Your System

When you lease a solar energy system, you do not own the equipment. You agree to pay a lease, which is basically a monthly rent payment to obtain the rights to use all the power generated by the system. This will require you to enter into a contract, which averages around twenty years.

Since there’s not usually large upfront cost associated with leasing, it helps to reduce the initial costs associated with these systems. But be warned: solar system leases might include a yearly raise in price on the monthly payment, which is called an escalations. These are risky, as they may exceed the rate at which the electrical company’s rates are going up.

The majority of commercial solar companies provide a guaranteed production amount for annual energy production for their system. Take into consideration what your energy needs are to decide on what size system you personally need. It is of the utmost importance to remember that the total energy your family uses can change from month to month, and the output of your solar system also varies. A lease payment, however, will be the same amount month in and month, no matter other changes.

Before entering into any kind of contract, ask what happens if the solar system breaks, or stops functioning all together. Also get the details on how repairs and upkeep are handled.

Something many people fail to think about are the downsides and/or conequences of a lease if you decide to move. Make certain you talk to your lease provider to see if new buyers must qualify to assume your lease, and ask what happens if the new owners don’t qualify.

Always be sure that you know all the terms of your lease agreement, and your obligations as part of that agreement, before signing on the dotted line. This will enable you to have a safe, productive solar system installation – without any surprises.

solar panels on roof of house
Solar panels on roof of new house

Option #3: Incentives & Tax Credits

Some qualifying installations might be eligible for incentives and/or tax credits that can help to offset the initial cost of purchasing a solar system.

Incentives include the solar solution incentive. Funds have also been earmarked to help offset the costs of solar system ownership by the Emergency Economic Stabilization Act of 2009, and the American Recovery & Reinvestment Act of 2009.

Another option is the Federal Tax Credit. This credit is available to the owner of the system. It can be used towards the purchase and installation of eligible solar systems that were installed prior to December 31st, 2016. Another tax credit option you may want to check out is the Federal Business Energy Tax Credit, although this is very hard to qualify for.

If you’d like more information on the federal tax credit, you can check out the Go Solar California Tax Credit website, or consult a tax professional. Either source should be able to answer all of your questions sufficiently.