Nature trumps utilities

"Net metering" lets homeowners cut the electric bill by using solar or wind power.

Published February 20, 2007

HYDE PARK, N.Y. - When the sun shines brightly on their home in New York's Hudson Valley, John and Anna Bagnall live out a homeowner's fantasy.

Their electricity meter runs backward.

Solar panels on their barn roof often provide enough for all their electricity needs. Sometimes - and this is the best part - their solar setup pushes power back into the system. The Bagnalls "net meter," a state-sanctioned setup that allows homeowners to adopt renewable energy without taking the more radical step of disconnecting from their local electric utility.

Net metering essentially allows people to become mini-power producers. Programs vary state to state, but they are typically coupled with financial incentives that make it easier to invest thousands for photovoltaic panels, windmills or fuel cells. Since sun and wind are intermittent, customers still rely on the grid for steady service. The meter runs backward when more energy is produced than a customer consumes.

"When they first put this in, it ran backward more than forward," said John Bagnall, standing by a meter on a winter morning. "Even with a hazy sun ... we're producing electricity."

Advocates see net metering as an environmental twofer: It promotes green energy and reduces the strain on the power grid. But the number of people investing in solar panels or wind turbines has been relatively small, despite the selling point of being able to turn the table on electric utilities.

Federal legislation requires states to consider adopting net metering standards by 2008, though programs are in place in more than 40 states, reports the Interstate Renewable Energy Council. California is tops when it comes to net metering with 86 percent of the 15,200 customers tallied nationwide in 2004 by the Network for New Energy Choices, a New York City renewable energy advocacy group.

While only a tiny sliver of eligible customers net meter nationwide, the number of participants has picked up quickly in the past few years, said Chris Cooper, the network's executive director. He expects the trend to continue.

Still, Cooper complained that burdensome paperwork, Byzantine rules and caps on the amount of renewable power any single customer can produce discourages participation in too many states. Also, many people don't know programs exist since neither government nor industry is doing a big advertising push.

But the biggest obstacle for most would-be net meterers is the startup cost.

Prices vary depending on how big a system is installed, but prices in the $8,000 range are common. New York offers rebates based on wattage that shave off thousands and there are state and federal tax credits, says John Wright of Hudson Valley Clean Energy, which installs the systems.

Wright said systems can provide 80 to 90 percent of a home's electricity, so they are able to pay for themselves usually in 10 to 12 years.