What is Net Metering? Net metering is a state regulation allowing customers to receive value during periods when their eligible on-site distributed generation (such as a wind turbine or solar array) generates more electricity than they use. That is, the electric meter runs backward whenever a customer’s net metered facility is producing more power than is being consumed and their account gets net metering credits for net excess generation at the end of the customer's monthly billing period. Summary of Net Metering in MA The state's new net metering policy (effective December 1, 2009) includes eligibility for all customers installing wind or solar PV up to 2 MW and for agricultural customers for any renewable energy technologies up to 2 MW. The value of a net metering credit (for any excess generation at the end of each monthly billing period) for the renewable facilities has been increased from the wholesale rate in the former policy to amounts closer to a retail rate, and determined by the Class of net metering facility and customer type (see below). Credits can also be carried forward month after month. The state's investor-owned utilities must offer net metering. Municipal utilities are not obligated to offer net metering, but they may do so voluntarily. The Massachusetts Department of Public Utilities (DPU) adopted amended net metering rules in July 2009 (see final order and the resulting net metering regulations). These DPU rules were ordered in accordance with the MA Green Communities Act passed in July 2008. In August 2009, the DPU issued its model net metering tariff and directed the utilities to file compliance tariffs, which are now approved and became effective December 1, 2009). The Department of Public Utilities (DPU) opened a docket on February 14, 2011 to make changes to Massachusetts net metering provisions pursuant to state legislation and to address issues related to interconnection. Materials for the proceeding can be found at the DPU File Room (Search Docket #: "11-11"). On July 22, 2011, the DPU opened a rulemaking (DPU 11-10) to revise the regulations pertaining to net metering. On February 12, 2012, DPU issued the Order and final regulations in response to legislation, adjusting the 1% cap to 1% for private projects and 2% for governmental entities, as well as, making other revisions and clarifications. The DPU has now directed the utilities to issue an RFP for a Net Metering Queue Administrator. Materials for the rulemaking can be found at the DPU File Room (Search Docket #: "11-10" and/or "11-11"). In DPU 12-01, DPU directed the companies to file new revised tariffs in compliance with a model tariff that embodies the changes in the DPU 11-10 Rulemaking.  For the purpose of calculating the aggregate capacity, the capacity of a net-metered solar facility is 80% of the facility’s DC rating at standard test conditions (STC) and the capacity of a net-metered wind facility is the name plate capacity. According to eligibility definitions in DPU 11-10, only Class II and Class III facilities contribute to the cap for public projects. The DPU has directed the utilities to report the aggregate capacity of net metered facilities on a regular basis. As of April 25, 2012, DPU had not yet released an Order to create a system for providing assurances of eligibility for net metering prior to operation. This system, also known as the Net Metering Queue, is expected to be addressed in DPU 11-11. The utility reporting on the net metering caps can be found at each utility's dedicated web pages:
Facilities in Operation Relative to the Cap on Net Metering (by Utility)
Eligibility and Calculating Net Metering Credits In Massachusetts, there are several categories of net metering facilities. "Class I" facilities are defined as systems up to 60 kW in capacity. "Class II" facilities are generally defined as systems greater than 60 kW and up to one megawatt (MW) in capacity that generate electricity from agricultural products, solar energy or wind energy. "Class III” facilities are generally defined as systems greater than 1 MW and up to 2 MW in capacity that generate electricity from agricultural products, solar energy or wind energy. Massachusetts also allows “neighborhood net metering” for neighborhood-based Class I, II or III facilities that are owned by (or serve the energy needs of) a group of 10 or more residential customers in a single neighborhood and served by a single utility. The neighborhood facility may also serve additional customers (including commercial) as long as the base requirements are met. All net-metered facilities must be behind a customer’s meter, but only a minimal amount of load located on-site is required.
The treatment of customer net excess generation (NEG) varies by facility class and customer type. In all cases, the NEG is monetized and Net Metering Credits are calculated based on the excess kilowatt hours (kWh) produced. In summary, value of the Net Metering Credits at the end of a billing period is slightly less than the utility’s full retail rate for Class I solar and wind facilities, Class II facilities, and Class III facilities used by government customers as they would receive credit for the default service, distribution, transmission, and transition charge (kilowatt hour, kWh). Net Metering Credits for Class III facilities and neighborhood facilities that are used by customers other than government entities differs only in that they do not receive credit for the distribution component. Class II and Class III customers are required to install revenue-grade meters to measure kWh output.
Credits may be carried forward to the next month indefinitely, and credits from net metering facilities may be transferred to another customer of the same utility as long as they are within the same electric service territory and ISO-NE load zone (MA Electric Service Territory Map | map of the ISO-NE load zones | the customer's bill also provides this information). Utilities may choose to pay for the net metering credits for Class III facilities rather than allocating the credits. If a facility has NEG at the end of a billing period, the credits are awarded to designated customers. The amount of NEG attributed to each such customer is determined by the allocation provided by the net metering facility. Third-party owned systems may be net metered. Utilities are not granted the renewable energy credits or environmental attributes generated by a net metered facility. Customers apply for net metering by completing the utility's accompanying net metering tariff (known as the "Schedule Z" in the model net metering tariff). Links to the utility net metering tariffs (see also more info on the docket: Enter Docket #: "09-03"):
See also DPU's FAQ's on Net Metering.
*This summary was adopted in part from text featured on the Database of State Incentives for Renewables and Efficiency (DSIRE) website. _______________________________________________________________________________________________________________________ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Net Metering in Massachusetts
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Net Metering Legislative Changes
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