The interconnection of devices that generate electricity, like solar panels, to the electricity grid are called net metering. If you've decided to invest in a solar or wind electric power generating system, rather than purchasing electricity from the utility, you can generate some or all of your own clean, renewable power. If you generate more electricity than you can use, net metering allows that electricity to flow back into the power grid for use by other customers. Essentially, excess electricity generated through your system will flow back through your utility meter and turn it backwards--essentially subtracting from the electricity you might have already purchased. In the event that you generate more electricity than you purchase, a credit balance will show up on your following month's bill. This credit can be used to offset future electricity purchases.
How it works
A home's standard, primary utility meter records the net use of electricity and how much is being generated. For example, if you have a 1000 Watt photovoltaic system that generates 150 kWh in July and you use 600 kWh in your home that same month, the net recorded on your meter will be 450 kWh. You pay the difference of 450 kWh on your utility bill. By slowing the meter down with electricity production, you receive the retail rate for producing electricity, which equals about 6.5 cents per kWh.
View an example of real-time solar production at The EnviroHouse.
Fact sheet - Solar net metering and financial incentives



