Net Metering Policy Research Articles

Impact of the net-metering policies on solar photovoltaic investments for residential scale: A case study in Brazil

The adoption of renewable energy resources is in the core of energy transition. However, its implementation can be highly impacted by country policies. A limited number of researches investigated solar photovoltaic investments, comparing net-metering rules for distinctive energy consumption levels and different discounted rates, from the investors’ point of view. This paper analyzes the impact of Brazilian net-metering rules on solar photovoltaic investments, considering residential scale. The methodology contemplates the development of a Discounted Cash Flow model to calculate Discounted Payback (DP), Net Present Value (NPV), Internal Rate of Return (IRR), and Levelized Cost of Electricity (LCOE) of projects. The case studies consider the impact of Brazilian regulation from net-metering rules (previous, considered, and current), energy consumption levels (Low, Middle, and High), and discount rates (5 %, 10 %, 15 %, and 20 %). The results show that from the previous to current rule the return for investor, on average, decreased 5.77 %. However, this reduction would be of 12.81 % if considered rule was adopted. For the 36 studies carried out, even in the worst case the investments remain viable. Therefore, the existing policy is suitable for the current stage of sector development; minimizing the impacts for energy tariff, distribution companies, consumers, and prosumers.

Understanding policy evolution using institutional grammar: net metering policies in the United States

Policy process scholars have expressed a long-standing interest in policy evolution, though such assessments offer a limited understanding of how policy language changes across time. These micro-level assessments of policy design evolution lend insights into substantive aspects of policy adjustment over time. In this paper, we conduct a comparative case study of changes in the text of net metering legislation in four US states. Specifically, using the Institutional Grammar (IG), we measure policy evolution as: (1) change in policy provisions that define the net metering policy system or regulate behavior, (2) change in different types of provisions (rules), and (3) calibration of policy provisions. Furthermore, we identify the dynamics of policy patching and packaging with these measures, demonstrating more information is revealed about the dynamics of policy evolution at the micro-level. For scholars and practitioners, our novel micro-level measurement allows discernment of changes in who is being incentivized, in what ways they are being incentivized, and the extent to which they are being incentivized. Furthermore, our approach can assist practitioners in identifying policy provisions and the language of those provisions that are changing more frequently, as we find policy language does not evolve evenly.

A guide to residential energy storage and rooftop solar: State net metering policies and utility rate tariff structures

Federal and state decarbonization goals have led to numerous financial incentives and policies designed to increase access and adoption of renewable energy systems. In combination with the declining cost of both solar photovoltaic and battery energy storage systems and rising electric utility rates, residential renewable adoption has become more favorable than ever. However, not all states provide the same opportunity for cost recovery, and the complicated and changing policy and utility landscape can make it difficult for households to make an informed decision on whether to install a renewable system. This paper is intended to provide a guide to households considering renewable adoption by discussing relevant factors that influence renewable system performance and payback, summarized in a state lookup table for quick reference. Five states are chosen as case studies to perform economic optimizations based on net metering policy, utility rate structure, and average electric utility price; these states are selected to be representative of the possible combinations of factors to aid in the decision-making process for customers in all states. The results of this analysis highlight the dual importance of both state support for renewables and price signals, as the benefits of residential renewable systems are best realized in states with net metering policies and above-average electric utility rates.

Techno-economic and environmental assessment of solar-based electrical vehicles charging stations integrated with hydrogen production

With the growing interest in adopting both commercial and residential electric vehicles (EVs) utilizing green renewable energy, the techno-economic assessment of EV charging stations with solar energy is a critical aspect of the transition to sustainable transportation. However, battery storage capacity for variable solar energy production is becoming increasingly less cost-effective due to the higher Lithium price. Complementing solar energy production and battery storage, the potential of combining green hydrogen fuel energy integration with solar energy for EV charging stations can provide a sustainable alternative to reach carbon-free transportation. This research aims to assess the technical and economic viability of grid-connected Photovoltaic (PV)-based EV charging stations across Kentucky based on existing EV load profiles. The study considers different PV system sizes, locations, orientations, and the impact of net metering policies and electricity tariffs on the profitability of the PV systems. Using excess PV energy, Lithium-Ion batteries will be charged, which will be assessed considering the techno-economic and environmental impacts of green EV charging stations. To further enhance green renewable energy production, we also investigated the feasibility of on-grid PV-based EV charging stations with Lithium-Ion batteries charged during low tariff periods. In comparison with these scenarios, we studied the potential benefits of integrating green hydrogen energy production using excess solar energy with and without governmental incentives. Furthermore, we assess the environmental impact of these green EV charging stations across Kentucky. Our study indicates that EV stations across Kentucky have similar techno-economic feasibility with insignificant deviation in the levelized cost of electricity, payback period, and PV energy fraction with/without Li-Ion batteries. However, with green hydrogen production, the marginal H2 production cost indicates the first scenario (on-grid PV energy charging) is the most significant, roughly 10 USD/Kg, which is ∼1.5 times higher than the second (charging during low-tariff periods) and the third scenarios (power grid to satisfy the demand deficit – approximately 6.5 USD/Kg). From the environmental perspective, the second scenario would be a good option for either hybrid EV/H2 or EV charging stations in Kentucky, factoring in the hydrogen production cost and the carbon footprint.

Investigating energy policies to boost grid-connected rooftop solar PV in Sudan

Abstract Grid-connected rooftop solar photovoltaic (PV) systems can reduce the energy demand from the grid and significantly increase the power available to it. However, rooftop solar PV has not yet been widely adopted in many sub-Saharan African countries, such as Sudan, although they are endowed with high solar radiation and in dire need of additional power. This paper investigates risks and policies to increase grid-connected rooftop solar PV adoption in Sudan. A simplified United Nations Development Program Derisking Renewable Energy Investment framework is adopted to investigate this over three stages. For Stage 1, a list of risks and barriers was produced based on a literature review of solar PV studies in Sudan and interviews with nine stakeholders. Affordability was the risk most often mentioned (eight times from nine interviewees), followed by concerns about poor utility grid infrastructure. For Stage 2, policy de-risking instruments and financial de-risking instruments were listed to overcome the barriers. These include the introduction of net metering, the use of a third-party organization to monitor policy implementation, upgrade of the grid infrastructure, public awareness campaigns and energy-saving schemes. For Stage 3, the levelized cost of electricity was estimated for a typical 2-kW rooftop PV system without policies (0.11 $/kWh) and with a net-metering policy (0.07 $/kWh).

Evaluating diffusion in policy designs: A study of net metering policies in the United States

AbstractIn the United States, some of the most important environmental policy innovations of the past decades have occurred at the state level. Net metering policy is one kind of policy that states have widely adopted in support of decarbonization goals. The widespread adoption of net metering policies varying in policy design, defined here as policy content, offers an opportunity to investigate to what extent policies that diffuse widely bear comparable designs, and furthermore, what factors influence diffusion in policy designs. Availing these opportunities, in this paper, we investigate (1) how (dis‐)similar the designs of American states' original net metering policies were; and (2) what factors explain the diffusion of policies that share similar design elements. To support our investigation, we model using event history analysis in a directed dyad setting, the factors that explain differential duration to adoption of net metering legislation containing specific elements of design by policy receiver states. We find that bipartisan legislatures are more likely to adopt the majority of design elements. This suggests that net metering appeals to policy makers across the political spectrum and that the latter compromise in integrating elements of policy design that benefit or burden different constituents. We also find that over time, states become less likely to emulate policy designs from jurisdictions whose citizenry embraces dissimilar values, suggesting that policy makers learn to tailor incentives to their local policy targets.

Recovering fixed costs in the presence of prosumers

The existence of prosumers who concurrently produce and consume electricity with distributed renewable resources such as photovoltaic generation has been viewed as an effective way of fortifying grid resilience and enhancing sustainability. However, prosumers’ self-consumption is impacted by how surplus electricity is priced when feeding it into the grid. From the perspective of fixed cost recovery, this study compares market outcomes when their transactions with the grid are subject to net-metering and net-billing policies considering both the wholesale and retail markets. Under the net-billing policy, prosumers may face a power price lower than the retail rate or the wholesale price when selling their surplus energy into the grid. Compared to the benchmark case, where prosumers are subject to the same price signals as conventional consumers and producers, prosumers would over-consume under the net-billing case. The net-billing policy converges to the net-metering policy when prosumers purchase power from the grid. The analysis also finds that the net-metering policy can result in more wealth transfer from conventional producers and consumers to prosumers when compared to the net-billing policy.

Early adopters of residential solar PV distributed generation: Evidence from Brazil, Chile and Mexico

Substantial adoption of solar rooftop systems in the residential sector resulting from the implementation of net metering policies can lead to worsening socioeconomic inequalities. This is because of the lack of information on the socioeconomic profiles of distributed solar generators. To fill this information gap and shed light on the determinants of solar photovoltaic distributed generation uptake, this paper aims to identify the profile of the first adopters of solar PV distributed generation by merging different databases. Using multilevel regression analysis, this study investigates how socioeconomic factors, project viability, and neighborhood variables, matter for adopting solar PV distributed generation in Brazil, Chile, and Mexico. Results differ across countries, as institutional frameworks matter. In Brazil, adopters live in urban areas and are highly responsive to solar energy potential. In Chile, the size of the project matters. Finally, in Mexico, results show that demonstration effects play a crucial role in adoption. Income as a determining factor is inconclusive. Average spending on electricity matters in all countries. This study highlights the existence of heterogeneity in the distribution of solar distributed generators. To mitigate these distortions, this work suggests some recommendations to improve solar distribution net metering policies in Brazil, Chile, and Mexico.

The Grid Connected Roof Top Solar Project in Army Institute of Technology; a Case Study

Abstract: Educational Institutions are often under pressure for cost cutting. Electricity charges, especially in a residential institution, is one of the biggest drain on finances. In this case study, we would like to discuss the grid connected roof top solar project in Army Institute of Technology (AIT), Dighi, Pune. This 350 kW system has been installed without any cost to AIT, on Build-Operate-Transfer (BOT) model, for 25 years at the rate of Rs 6/- per electricity unit. The power generated by the system is approximately 1000 to 1200 electricity units per day as against a requirement of about 1800 to 2000 electricity units per day. Net Metering Policy implemented by Maharashtra Government enables AIT to send excess electricity generated during day time back to the grid. This excess power given to the grid is credited back during night time. A new Net Meter has been installed in AIT that provides daily status of the power import/export. This has resulted in Cost Savings of nearly Rs 1,50,000/- per month which comes close to Rs 18,00,000/- per annum. Keywords: AIT, Build-Operate-Transfer, cost cutting, grid, roof top, solar

Implementation of DC net metering scheme in off-board EV charging systems with a time of usage capability

Dynamic pricing is one of the most significant aspects of strengthening the existing power grid. The widespread adoption of electric vehicles (EVs) increases the average electricity demand and peak power consumption. Meanwhile, the uncoordinated EV charging makes the condition even more severe by widening the gap between power supply and demand. Consequently, it demands the reinforcement of the current electricity network. However, a net-metering policy based on time of usage (TOU) pricing helps in demand side management including vehicle-to-grid (V2G) scheduling. It reduces the impact of peak load and provides incentives for all EV owners and utility operators. In this research, a problem has been formulated to reduce the electricity bill with TOU-critical peak pricing (CPP)/peak time rebate (PTR) based tariff structure to coordinate the EV charging. The economic analysis of the flat and proposed pricing structure has been discussed with the help of case studies. Further, the DC net meter designed and developed by the authors has been tested on the proposed pricing scheme to minimize the losses and improvise the load curve.

A comparison study of grid impact of photovoltaic installations in Brazil according to Normative Resolution 482 and Federal law 14.300

This work focuses on comparing the Brazilian first distributed energy net-metering policy, instituted by Normative Resolution (NR) nº 482/2012, and the new system, instituted by Federal Law 14,300/2022. A review of the development of international distributed energy regulation is presented, along with a review of the impacts caused to distribution grids because of distributed energy systems. A set of equations is presented to compare the energy billing for consumers under the old and the new Brazilian policies. Using the indication of the amount of energy the consumers are inclined to produce to reduce their bill, the PV energy production scenarios for five different low voltage distribution grids in Brazil are simulated. The simulations indicate that an increase in the power injection into the Brazilian distribution grids could lead to transformer overload and end-of- line overvoltage. The investment cost and loss of revenues from the installation of PV systems are also compared between different regulations scenarios, showing better revenues but also greater investment required for utilities under the new regulation. One of the main conclusions is that new Brazilian policy is reducing the loss of revenue in distributed energy, however, there is a risk for misplaced investments in the distribution grid.

Evaluating the use of a Net-Metering mechanism in microgrids to reduce power generation costs with a swarm-intelligent algorithm

The micro-generation of electricity arises as a clean and efficient alternative to provide electrical power. However, the unpredictability of wind and solar radiation poses a challenge to attend load demand, while maintaining a stable operation of the microgrids (MGs). This paper proposes the modeling and optimization, using a swarm-intelligent algorithm, of a hybrid MG system (HMGS) with a Net-Metering compensation policy. Using real industrial and residential data from a Spanish region, a HMGS with a generic ESS is used to analyze the influence of four different Net-Metering compensation levels regarding costs, percentage of renewable energy sources (RESs), and LOLP. Furthermore, the performance of two ESSs, Lithium Titanate Spinel (Li4Ti5O12 (LTO)) and Vanadium redox flow batteries (VRFB), is assessed in terms of the final $/kWh costs provided by the MG. The results obtained indicate that the Net-Metering policy reduces the surplus from over 14% to less than 0.5% and increases RESs participation in the MG by more than 10%. Results also show that, in a yearly projection, a MG using a VRFB system with a 25% compensation policy can yield more than 100000$ dollars of savings, when compared to a MG using a LTO system without Net-Metering.

A methodology for determining the incentive policy for photovoltaic distributed generation that leverages its technical benefits in the distribution system

Although photovoltaic distributed generation (PVDG) is expanding worldwide, its growth is still relatively small in most countries. Thus, it is necessary to establish appropriate incentive policies that increase the integration of PVDG into the distribution system. The impacts that the adoption of each policy causes must be analyzed to maximize the benefits and minimize the technical problems arising from the integration of PVDG into the grid. In this context, this study proposes a methodology to determine the most appropriate policy to encourage PVDG by observing its technical impacts on the grid. A stochastic model is proposed to determine the technical and financial impacts on voltage levels, technical losses, and peak demand derived from the integration of PVDG. The proposed methodology was applied to dozens of real feeders, seeking to compare the Net Metering (NeM) and the Feed-in Tariff (FiT) policies. The results showed that the NeM policy presented the best performance. Among the two investigated FiT policies, it was verified that the incentive to PVDG with lower powers implies greater benefits. This methodology allows the determination of the most appropriate PVDG incentive policy considering its technical impacts on the grid.

Assessment of spatial implications of photovoltaics deployment policies in the Netherlands

Electricity generation with photovoltaic (PV) solar energy technology requires significant amounts of space; a particular point of discussion in a densely populated country like the Netherlands. Therefore, we developed a new analytical framework to analyse potential electricity generation for specific PV typologies on 43 different land utilisation and water types. Our results indicate that spatial potentials for PV are substantial compared to current Dutch scenarios and ambitions for its role in a long-term decarbonised energy economy. The spatial potential of PV on rooftop areas is sufficient to largely meet these ambitions; however spatial allocation depends on more factors than the potential alone, e.g. desired implementation speed. Therefore, we have sketched some variants with a more balanced allocation over the various land use types. Innovative options, such as PV within offshore wind parks and on infrastructure, parking spaces and façades offer considerable opportunities for additional generation. Furthermore, we illustrate the considerable impacts on PV potential of (i) current net metering policy, (ii) the upcoming societal preference for lower panel densities in land-based PV parks, and (iii) a focus on cost efficiency instead of spatial efficiency. Policy makers should bear these outcomes in mind when designing support schemes for PV.

Framework for the analysis of renewable energy grid policies in the context of COVID-19

COVID-19 is a severe global pandemic that has caught the whole world unprepared. In the absence of a clear timeline for this pandemic to end, it is need of the hour to investigate the effect of this pandemic on both previous and anticipated investments. Global economic unrest has hindered the ramping deployment of Renewable energy projects. The most quick actions that may be taken to mitigate the effects and to up-rise the investment portfolio policies are a very critical tool in hands of government for a very immediate effect have also been made without keeping the context of COVID-19 into account. New variants of diff rent nature are being discovered and every now and then new lock downs are happening. In this context different policies have to be evaluated under the pandemic scenario. A case study of a large scale renewable energy project for a higher education institute in Pakistan is being used to measure the difference during COVID and pre COVID times. This paper provides a framework to investigate the impact of COVID on renewable energy system projects under current net-metering, net-billing and self-consumption policies. A recent investment in a photovoltaic system is assessed based on previously projected financial benefits versus the pandemic effected ones. This research concludes that investing in photovoltaic systems are still a viable option even in an extreme pandemic situation with less than 0.5 years increase in payback period, and the government can still provide a stimulus for investing in green energy by implementing net-metering policies on a larger scale.

Virtual Net-Metering Option for Bangladesh: An Opportunity for Another Solar Boom like Solar Home System Program

This study explores the virtual net-metering (VNM) option for enabling inclusive investment opportunities in renewable energy for self-consumption in Bangladesh. It focuses on consumers, such as households and businesses in multi-family and multi-story buildings, who cannot participate in traditional net-metering policy due to technical and space constraints. The study adopted the classical socket parity method to identify suitable consumers for VNM. Then it determined the consumer benefits of using VNM by calculating the net present cost (NPC) and discounted payback period. The results reveal that several consumer categories can significantly save on electricity costs through VNM. For example, commercial consumers can save more than 50% of their electricity bills by investing in a VNM-enabled remote solar power plant with a discounted payback period of fewer than six years. The discussion articulates more comprehensive benefits of VNM. It addresses challenges for renewable energy development by identifying local opportunities. Therefore, this research can help initiate policy dialogues and create momentum for citizen investments in the energy transition. The proposed approach can also be used to analyze the economic feasibility and potential of VNM in other countries.

Renewable Energy for Sustainable Development: An Assessment of Solar Energy Adoption among SMEs in the City of Accra, Ghana

Energy demand continues to drive sustainable development in all countries of the world. As Ghana is accelerating her transition to a low carbon economy, this paper aims to investigate the nature, opportunities and challenges of the solar energy market in the City of Accra. This paper used a qualitative inquiry approach to investigate the solar energy market development in Accra. The Ghana Government’s policy framework for achieving sustainable energy in the country as well as the emerging opportunities and barriers relating to market development of this energy sub-sector in Accra are analysed. The paper found that inadequate institutional and service-provider’s financial support, after-sales technical support, limited consumer credit facilities, a dearth of public education and general awareness among the public about solar energy technology remain important barriers to solar energy development in Accra. In addition, the Net Metering policy dissonance constitutes a critical barrier to solar energy transition and market development in the city. In conclusion, government programming and increasing industrial sector participation will provide a vital catalyst for the development of the solar energy sub-sector and market in Accra.

Identification of target market transformation efforts for solar energy adoption

In recent years, solar energy has been increasing in usage throughout the world, especially in the United States. Market transformation (a concept based on collaborative efforts between industry advocates and policy-makers to increase adoption through economies of scale) plays a fundamental role in expanding the adoption of solar energy. However, there are currently limited resources to identify the optimal locations for increasing the likelihood of industry advocates interested in exploiting opportunities related to solar energy technologies. This study aims to showcase a visual mapping tool to assist with solar energy market transformation. By combining data from different sources, a unique process and output were created. The factors considered in this study include cost of electricity, net metering policies study, cost of solar energy systems, solar irradiance, annual sunshine rates, annual snowfall rates, and annual precipitation rates. All the factors were considered on both a residential and commercial level. The findings rank states from most viable to least viable with respect to the combined input factors. The results show that states with a high likelihood of market transformation at the residential level also have a high likelihood of market transformation at the commercial level.

Power to the prosumer: A transformative utility rate reform proposal that is fair and efficient

There is a continuing clash between utilities and proponents of distributed generation, particularly rooftop solar. Generation intermittency, zero-marginal cost energy, and net metering policies associated with solar power make planning, operations, and pricing difficult for utilities. Customers without solar are increasingly concerned they are footing an increasingly larger share of grid costs, while solar customers feel they are not receiving credit for lowering costs for the utility. These pricing issues are caused by an archaic rate structure. We propose that utilities introduce cost-causative rates applied to all customers and adopt transitional methodologies to make a smooth transition between the old and proposed rate structures. Once fully in-place, cost-causative rates will empower customers to increase their own savings while simultaneously reducing costs for others.

Transition towards solar Photovoltaic Self-Consumption policies with Batteries: From the perspective of distribution networks

The transition towards low-carbon energy systems requires increasing the contribution of residential Photovoltaic (PV) in the energy consumption needs (i.e., PV self-consumption). For this purpose, the adoption of PV self-consumption policies as alternatives to the current net-metering policy may support harnessing batteries to improve PV self-consumption. However, the technical impacts of PV policies on distribution networks have to be adequately assessed and mitigated. To do so, a two-stage planning framework is proposed. The first stage is an optimization approach that determines the best sizes of PV and batteries based on the adopted PV policy. The second stage assesses the impacts of the resulting sizes on distribution networks using Monte-Carlo simulations to cope with uncertainties in demand and generation. The framework is applied on real medium and low voltage distribution networks from the south of Jordan. For the net-metering, the results show that the uptake of residential PV penetration above 40% will result in voltage issues. It is also found that the adoption of batteries for the benefits of customers (i.e., reduce electricity bills) will not mitigate the PV impacts for PV penetration above 60%. Further, the results demonstrate the important role of distribution network operators to manage the uptake of batteries for the benefits of customers and distribution networks. Network operators can support customers to adopt larger sizes of batteries to achieve the desired PV self-consumption in return of controlling the batteries to solve network issues. This facilitates the uptake of 100% PV penetration and improves PV self-consumption to 50%.