Solar energy is the gift that keeps on giving, even when the sun isn’t shining. With the right design, your solar panel system can produce enough power to meet all of your electricity needs for the entire year.
With seasonal changes and weather cycles, the varying amount of electricity that your solar panels produce throughout the year can result in excess solar power. This leads us to a common question among new solar users:
What happens when my solar panels produce too much solar power (or not enough)?
Simply put, if your system produces less electricity than you need, you must buy electricity from your utility grid, which will automatically be supplied to you. Most photovoltaic (PV) solar systems are connected to the grid, but the generated solar energy will first go to powering your electronics, lights, and appliances before your electric company steps in and supplies you with power, if needed.
If your system produces surplus power, your meter will actually run in reverse as that excess power gets fed back to the grid. When this happens, you will receive a credit on next month’s electricity bill. The credit you get for the excess electricity will be at the retail price that you pay for the electricity you take from the grid, typically about 60% of the supply rate. This billing mechanism is called net metering.
In Maryland, the net metering law allows you to produce up to 200% of solar usage. Surpassing this amount will not qualify for a reimbursement, but your system will still generate Solar Renewable Energy Certificates (SRECs) which can be traded as commodities on the Maryland SREC market. SRECs are your ticket to gaining a significant source of revenue from your system. Their value is determined by supply and demand in the trading market.
Why does my system produce too much solar power?
There are a number of reasons why you’re producing more power than you need:
- The season or time of day can alter the amount of energy generated
- Low energy consumption due to an unoccupied household or commercial space for a period of time; therefore, your system produces much more energy than you use
- You are just not using much energy
Fact: solar panels generally produce excess power in the summertime and use more electricity from the grid in the winter. Effectively, you build credits during the summer, which are stored for use when you need them, like at night or on those winter days.
In all these cases, you’re feeding energy into your solar net metering which can help you save hundreds more dollars per year on your electricity bills. If your solar panels continuously produce surplus solar power throughout the year, your utility company will issue a rebate for the difference at wholesale price at the end of the year. Once you factor in these rebates and incentives to your solar panel installation, your monthly savings can finally go to that family vacation, home renovations, or saving for the future.