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NEM Concept

What is NEM?

Net Energy Metering, NEM, is a net metering concept relating to energy produced from solar PV systems. The idea of NEM is that excess energy produced from a solar PV system which isn’t consumed is exported and sold to a distribution licensee at a cost prescribed by the Energy Commission. The overall aim of NEM is to address climate change and help to reduce the public energy consumption generated by fossil fuels.

How Does Net Metering Work?

NEM begins with a PV system which any member of the public can install on the rooftop or car porch of their own premises. Solar PV is a relatively simple technology to install and operate, and is one of the least expensive technologies applicable to NEM. Once installed, the household will generate its own clean energy with excess energy produced sold to a distributed licensee such as TNB or SESB. This scheme not only reduces fossil fuel use within an individual home, but also help to produce clean energy and reduce fossil fuel use around the country.

What are the Benefits of NEM?

With net metering explained above, it is clear the benefits of such a scheme are plentiful. Firstly, energy generated by a solar PV will be consumed first, allowing a reduction in imported energy to a home. This saves both money on electricity bills and the environment by reducing the use of fossil fuels. A second, and important, benefit of NEM is that no energy goes to waste. If a household consumes less energy than they are producing, the excess energy is exported to the utility grid and paid for in credit. A third benefit of NEM is the overall reduction of CO2 emissions. As more households sign up to NEM, the overall carbon footprint of the country is reduced, CO2 emissions are lowered, and a large step is taken in the fight against climate change.

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