NC Net Metering (NEM) Updates 2023
Changes to Duke Energy's Solar Policies in NC
KEY TAKEAWAYS
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​Net Metering is not going away but will undergo massive changes.
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This applies to all NC Homeowners within Duke Energy and Duke Progress service areas and was approved by the NC Utilities Commission on March 23rd, 2023.
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New solar customers must have an Interconnection Application submitted before October 1, 2023 to be grandfathered into the current net metering policy.
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Duke Energy has also announced that our price for purchasing electricity will potentially Double over the next 3 years starting the 1st increase to happen this fall.
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If you are considering going solar, right now is the best time to take action so that you can take full advantage of the current NEM policies, rates, and the recently renewed 30% Federal Tax Credit.
What Is Net Metering?​
Net metering is a billing arrangement used in the context of renewable energy systems, such as solar power. It allows customers who generate their own electricity from renewable sources to offset the energy they consume from the grid by exporting any excess electricity they generate back to the grid.
Under net metering, the electricity meter at the customer's property measures both the electricity consumed from the grid and the electricity generated by the renewable energy system. If the customer produces more electricity than they consume, the excess electricity is sent back to the grid, effectively spinning the meter backward.
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At the end of a billing period, the customer is billed for only the net energy consumption, which is the difference between the electricity consumed from the grid and the electricity exported to the grid. If the customer exports more electricity than they consume, they receive a credit for the excess electricity, which can be applied to future electricity bills.
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Net metering provides an incentive for individuals and businesses to invest in renewable energy systems by allowing them to offset their energy costs and potentially earn credits or financial compensation for the excess electricity they generate. It promotes the integration of renewable energy into the grid and helps reduce reliance on fossil fuel-based electricity generation.​​
How Does It Currently Work?
Under Duke Energy's current net metering policy, customers receive electricity credits for the excess solar energy they generate. These credits are stored by the utility at a 1:1 rate, meaning customers receive the full retail value of their solar electricity. Net metering can be likened to an energy bank, enabling customers to save their surplus solar energy for future use, particularly when weather conditions are less favorable.
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Currently, the monthly minimum billing fee for net metering with Duke in NC is $14 per month, under NEM 2.0 this will change.
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What Will Be Changing?
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With the updated regulations applicable to new enrollees starting from October 1, customers will continue to receive a 1:1 credit for their solar energy production. However, there will be a change in the credit reset period, shifting from a yearly reset to a monthly reset. The utility will provide customers with credits based on the wholesale rate they pay for energy, which is presently set at $0.0335 per kilowatt-hour (kWh). It is important to note that this rate is significantly lower than the retail rate, which customers typically pay. Additionally, solar customers will be subject to various additional fees as part of the revised policy.
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Additional Fees:
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A minimum monthly billing fee of $22 for Duke Energy Carolinas customers
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A minimum monthly billing fee of $28 for Duke Energy Progress customers
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There will also be small monthly fees called non-bypassable charges:
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$0.36 per kW for Duke Energy Carolinas customers
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$0.44 per kW for Duke Energy Progress customers
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Upon going solar after October 1, 2023, customers will also be required to make a choice between two new rate options: the modified net metering rate or the new time-of-use (TOU) rate. The selection of the most suitable rate option will depend on several factors, including the presence of battery storage, energy consumption patterns, ownership or future plans for owning an electric vehicle, lifestyle habits, and other relevant considerations. It will be important to carefully assess these factors to determine the optimal rate option for individual circumstances.
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How do changes in net metering affect the future of solar energy in North Carolina?
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The modification in net metering has introduced more intricate calculations regarding the value of solar energy for homeowners. Previously, under the legacy net metering program, the value of solar energy was straightforward, equating to the retail rate paid for electricity. Determining the worth of solar energy was a simple process, involving a review of historic utility bills and Duke Energy's prevailing rates.
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However, with the new program that comes into effect after October 1, the evaluation of solar energy becomes more complex for households transitioning to a time-of-use (TOU) rate. The value of solar will now depend on multiple factors, including the time of day, day of the week, month of the year, and the ratio of solar production versus energy consumption on an hourly basis for each home.
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The introduction of these variables adds considerable complexity to the solar design and modeling procedure. Under the previous net metering system, effective solar modeling required 24 energy data points, encompassing 12 months of historical energy usage and 12 months of projected solar production. However, under the new system, this number significantly increases to 17,520 data points. Hourly data is now required for both historical energy usage (8,760 hours) and projected solar production (another 8,760 hours).
These changes create a higher potential for miscalculating solar savings. Consequently, it becomes crucial to seek guidance from a reputable local solar company that possesses in-depth knowledge of these rate structures before making any solar-related decisions.
It is advisable to make an informed choice promptly before the situation becomes more intricate after the October 1st implementation date.
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