NJ Net Metering

Net Metering in NJ with Solar

Net metering allows residential and commercial customers in NJ who generate their own electricity from solar power to feed electricity they do not use back into the grid. NJ has some of the best net metering laws in the nation.

Net metering helps customers maximize their renewable energy investments.  It enables customers to obtain full retail credits on their utility bill for each kWh of electricity their system produces up to 100% of their electricity usage over the course of a year. That’s right, in NJ you receive 100% credit for all the solar power your system feeds back to the utility.

When a renewable energy system produces more electricity than the customer actually uses, the customer will be compensated with credits at the full retail value of the electricity for the production over and above what they use.  For example, on a typical sunny day at moderate temperatures, a customer with a solar system may use less electricity than the system actually generates. When electricity production exceeds usage, the utility meter will spin backwards and provide the customer with credits for the excess energy produced. These credits can be used by customers as needed.

With net metering, your electric meter spins forward when electricity flows from the utility into the home, and backwards when power flows from the home to the utility.  Your stored kWhs are “netted,” or paid back, on an annual basis.

Please be advised that when a net metered customer with a renewable energy system switches their electric supplier or elects to change their anniversary date, any excess generation that exists at the time of the change is credited at the wholesale electric rate known as Locational Marginal Pricing (LMP) rather than as a full retail credit. The solar electric generation balance is zeroed out and a new 12 month cycle begins on the effective date of switching to the new electric supplier or of establishing a new anniversary date. It is recommended that you consult with your existing supplier to understand the status of your net metering account prior to switching electric suppliers. The full text of the applicable rule may be found at N.J.A.C. 14:8-4.3 j (1) and (2).

Together, New Jersey’s interconnection rules along with the net metering rules ensure that customers with renewable energy systems or generators are compensated for the clean, renewable energy they produce.

What Is Net Metering?

Net metering is a billing mechanism that credits solar energy system owners for the electricity they add to the grid. For example, if a residential customer has a PV system on the home’s rooftop, it may generate more electricity than the home uses during daylight hours. If the home is net-metered, the electricity meter will run backwards to provide a credit against what electricity is consumed at night or other periods where the home’s electricity use exceeds the system’s output. Customers are only billed for their “net” energy use. On average, only 20-40% of a solar energy system’s output ever goes into the grid. Exported solar electricity serves nearby customers’ loads.


New Jersey’s Net Metering program has served as a model for other states and continues to lead the industry in streamlining the net metering rules to ensure customers with small, on-site, renewable energy systems (solar, wind, and bio-power) can easily connect to the electric grid through their utility companies.

The interconnection and net metering rules are designed to motivate customers to invest in renewable energy sources on their properties by ensuring that customer-generators are compensated for the energy they produce. They provide a key incentive for customers to contribute to the availability of safe, reliable, and affordable electricity and help protect our environment in New Jersey.

NETMETERING AGREEMENT (for grid-connected solar energy systems)

Net metering means the utility company charges you the difference between what you consume from the grid and the electricity you generate.

This allows your electric meter to spin forward when electricity flows from the utility into your home (at night and during stormy weather), and backwards when your renewable energy system produces surplus electricity that is not immediately used by your house (during the middle of the day). Most existing utility meters will work for net metering. But, you will need to establish an interconnection agreement with your utility company to get a net-metering account. Hughes will handle much of this paperwork for you.

This agreement will ask you to demonstrate that your system was installed to certain building codes and electrical standards, prove that your system is insured, and show that your utility has access to a disconnect in case they need to shut your system down to service the grid — line repair men need to be kept safe from your system when they are working on the grid.

Remember, we’re all connected together through the power grid. The interconnection agreement helps make sure everyones power remains safe and of high quality and reliability.

Net Metering allows you to receive credit for the excess power you produce; you only pay for the net amount your home uses as provided from the utility grid.

We recommend you work with your installer, but provided below are links you can use to apply for Net Metering, or contact your utility company to learn more.

General Information about net metering is available from the U.S. Department of Energy http://www.eere.energy.gov/greenpower/markets/netmetering.shtml
Or you could check out the JCP&L PDF on net metering.

Contact Hughes to discuss net metering further and find out if this incredible NJ program can benefit you and your solar energy system.