Net metering scheme for solar panels

This has led to an increase in the number of households and businesses investing in solar panels, which contributes to making energy consumption in the Netherlands more sustainable. However, the net metering scheme is affected by grid congestion , which will bring about many changes in the coming years that will have significant consequences for both consumers and the energy market.

What is the net metering scheme?

The net metering scheme is a scheme that enables consumers to feed back the electricity they have generated with their solar panels and do not consume themselves via the grid connection provided by the supplier, which is usually at low voltage level. This means that the electricity generated is settled at the same price as the electricity purchased from the energy supplier.

The result is that you pay less for the electricity you purchase from your energy supplier, as using your own generated electricity reduces costs. This makes the purchase of solar panels and a home battery more financially attractive to consumers and contributes to making the energy supply more sustainable.

How does the net metering scheme work?

The net metering scheme operates according to a number of specific rules that determine how much electricity you can net meter and how the return of energy is calculated. The most important rules are listed below:

• Maximum netting: you can only net the number of kilowatt hours (kWh) of energy that you have actually purchased from your energy supplier. If you have generated more energy than you have consumed, you will receive a feed-in tariff for the surplus energy.
• Own consumption: if you consume more electricity than you generate yourself, the difference is supplemented by electricity from your energy supplier, for which you pay. This is not offset, but simply purchased.
• Feed-in tariff: you can receive a feed-in tariff for the electricity that you cannot offset. The amount of this tariff varies per energy supplier and is often lower than the price you pay for electricity consumption.
• Annual settlement: the balance is usually calculated annually. At the end of the year, the balance between consumption and the electricity fed back into the grid is determined. If you have fed back more energy than you have consumed, you will receive a feed-in tariff for the surplus.

End of net metering scheme

After years of success, the net metering scheme is coming to an end. This is causing a lot of division and discussion. The scheme has contributed to the rapid growth of solar panels in the Netherlands, but the government has decided to phase it out gradually. This means that in the future, consumers will no longer be able to offset their generated electricity under the current conditions and it will be more advantageous to opt for long-term energy storage.

This decision has raised concerns among many people about the feasibility of solar panels without the favorable scheme. However, it may still remain attractive when using a home battery for solar panels. The phasing out of the net metering scheme is therefore a topic of much discussion and concern within the energy market.

Net metering scheme 2027

Starting in 2027, significant changes will be implemented in the net metering scheme. Net metering of generated electricity will no longer be available in its current form. The changes that will take effect in 2027 are as follows:

• Reduction of the net metering percentage: the percentage of the electricity generated that you can net meter will be gradually reduced from 2027 onwards, with the aim of completely phasing out the scheme by 2031.
• Introduction of a feed-in tariff: from 2027, the feed-in tariff for non-balanced electricity will be introduced for the first time. This means that consumers will no longer be able to offset the full value of their fed-in electricity against their consumption.
• Compensation based on market prices: the feed-in tariff is determined by market conditions and may vary depending on the supply and demand of electricity on the market.

Example of the net metering scheme

The net metering scheme can sometimes be difficult to understand, so here is a simple example of how it works:

Your situation:

• Consumption: 2,000 kWh
• Purchased from supplier: 1,200 kWh
• Generated with solar panels: 4,000 kWh
• Fed back into the grid: 2,800 kWh
• Net metering limit: 1,200 kWh (the amount of electricity you have received from the energy supplier)

Step 1: Offsetting

You may offset the first 1,200 kWh of the 2,800 kWh of electricity fed back into the grid. This means that 1,200 kWh of the electricity fed back into the grid will be deducted from your energy supplier's consumption.

Step 2: Feed-in tariff for the remaining 1,600 kWh

You will receive the remaining 1,600 kWh as a feed-in tariff. Assuming the feed-in tariff is €0.12 per kWh, you will receive €192 for the electricity you feed back into the grid.

Summary:

In this example, you will receive €192 for the 1,600 kWh you have fed back into the grid. Please note: you may have to pay additional costs for feeding electricity back into the grid, depending on your energy supplier.

Net metering scheme news for the future

With the phasing out of the net metering scheme, from January 1, 2027, it will become less and less financially attractive for solar panel owners to feed their electricity back into the grid. During the period from January 1, 2027, to January 1, 2030, customers will have to pay at least 50% of the costs for the electricity they feed back into the grid.

The energy supplier must charge these costs, which it incurs for supplying electricity to consumers, to the same customers. This means that, from 2027, solar panel owners will incur higher costs for the electricity they feed back into the grid, which will have consequences for the economic viability of solar panels in the future.

Solution for abolishing the net metering scheme

With the phasing out of the net metering scheme, there will be a change in the way you can use and feed back energy you have generated yourself. A good solution to accommodate this change is to use an energy storage system, such as a green home battery or salt battery.

At Frax, we offer innovative and sustainable Battery Energy Storage Systems (BESS), such as green home batteries and salt batteries, that perfectly match your energy needs. Our systems not only help you optimize your energy consumption, but also give you complete control over your own energy production and use.