Carlo's Think Pieces

Reflections of a Filipino in the Netherlands

Archive for June, 2008

Net metering/billing law needed

Posted by butalidnl on 10 June 2008

Net metering and net billing are important measures that need to be taken in order to fully utilize the potential of alternative energy sources. Net metering/billing is a system in which energy consumers could produce their own energy (usually alternative energy) for their own use, and sell the excess to the electricity grid at the same price that they buy electricity from the grid. This is why it is called “net” metering/billing. The alternative energy that the consumer sells to the grid for instance during the day (when there is a lot of sunshine) would be used to cancel part of the cost of the electricity used at night (when solar energy is not available). This sounds quite straightforward, but unless it is made into law, electricity companies will tend to pay consumers much less for the electricity produced by them than what it collects for the electricity it itself sells.

A law on net metering/billing is quite important for promoting alternative energy at the retail level, because it facilitates the connection of this to the electricity grid. Up front, it makes for real monetary savings, since with net metering/billing it is no longer necessary to have expensive batteries to store the alternative electricity during peak production periods – the electricity grid becomes, in effect, the battery.

While alternative energy is not yet being produced on a large scale, it is good to start promoting the emerging forms of alternative energy. The electricity grid is intersecting more and more with alternative energy in various forms such as biogas (from bio-waste), micro-hydro, and “co-generation” (e.g. burning of bagasse while producing methanol). Also, it will not be too long before the alternative energy from solar and wind could be connected to the electricity grid.

The net metering/billing bill would also have other advantages. Electricity companies will be required to extend technical assistance to consumers who want to connect their alternative energy sources with the grid. There would need to be national standards for the interconnection equipment.  A gradually more decentralized system of electricity generation would reduce electricity transport costs and promote stability in the grid.

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