How Net Metering Works: Saving Money with Solar Power
Turning Sunshine into Savings
For homeowners across Australia, solar energy isn’t just about sustainability—it’s also about smart savings. One of the key ways solar owners maximise their return on investment is through net metering. This system allows you to earn credits or payments for the excess electricity your solar panels produce and send back to the grid. In short, it’s a win-win: your home stays powered by clean energy while your electricity bill gets smaller.
What Is Net Metering?
Net metering is a billing arrangement between you and your electricity retailer. When your solar panels generate more energy than your household consumes, that surplus electricity flows into the local grid. In return, your electricity provider compensates you—either through feed-in tariffs (a small payment per kilowatt-hour exported) or energy credits that offset your future bills.
When your panels aren’t producing enough energy—say, at night or on cloudy days—you draw power from the grid as usual. The amount of electricity you’ve exported helps balance out what you use, effectively “netting” your energy consumption over time.
Feed-In Tariffs Explained
Feed-in tariffs (FiTs) are the heart of the net metering system. They represent the rate you’re paid for every kilowatt-hour (kWh) of solar power your system exports to the grid. These rates vary depending on your state, retailer, and plan.
For example:
In New South Wales, typical feed-in tariffs range from 5 to 10 cents per kWh.
In Queensland, rates often sit between 6 to 12 cents per kWh.
In Victoria, the minimum rate is around 4.9 cents per kWh, though some retailers offer higher rates for certain plans.
While FiTs aren’t as high as they once were, the savings from self-consuming your solar power and the credits you earn from exports still add up significantly over time.
Maximising Your Solar Savings
To make the most of net metering, try to use more of your solar power during the day, when your panels are most active. Running appliances like washing machines, dishwashers, and air conditioners during daylight hours ensures that more of your solar energy is consumed directly—reducing how much you need from the grid.
You can also pair your solar system with a battery storage unit. This allows you to store excess energy for later use instead of exporting it, helping you rely even less on grid electricity and shielding you from rising energy prices.
Net metering is one of the most effective ways to make your solar investment pay off. By feeding excess energy back into the grid, you not only reduce your power bills but also support a cleaner, more resilient energy network for everyone. Whether you’re just starting your solar journey or optimising your existing setup, understanding how net metering works can help you maximise both your savings and your sustainability.
Get in touch today to start our journey together.
Stay committed!
Damien Frearson
