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Net Billing Questions and Answers


What is Net Billing?

       Net billing is only really going to be an issue for you if you are connected to the utility grid.  If you are connected to the utility grid, and wish to generate your own electricity, how your utility will buy back your energy is of utmost concern to the payback potential of a wind energy system.

       Net billing is one billing method that is used when energy generator sell energy back to the utility.  If you produce 1 kWh of energy, and you consume 1 kWh of energy, net billing doesn't care if you used it when you weren't producing it or vice versa.  The NET effect of your bill shows the NET energy you consumed or generated.  This can be done with one electrical meter or two meters, and can be done on a monthly or annual basis.  An annual basis is preferable.  According to PURPA regulations, (see this post http://groups.yahoo.com/group/awea-wind-home/message/4032) you shouldn't be charged for the second meter if your utility wants you to use a second meter.  Net billing can be drastically different from the utility metering what you use and also what you generate (two meters).  This scenario is most frequently run into with Rural Electric Cooperatives (RECs).  Typically, when you hook up with them, they charge you the going rate for the energy that you consume, and they will pay you avoided cost for what you generate in excess of what you used.  You are not selling energy to them at the retail rate.  For example, in ND, they pay about 1.5 cents/kWh for what I would generate, but if I use any energy, I must pay them 6-8 cents/kWh for what I use.  The 1.5 cents/kWh that they pay me is what they call "avoided cost".  This is the cost of the coal that they didn't have to burn (they avoided burning) to produce the 1 kWh that I generated.


       Net Billing Question ...answered (question's at the end):


       More on Net Metering







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