Net Energy Metering (NEM), Net Energy Meter Aggregation (NEMA), and Virtual Net Energy Metering (VNEM) are policies designed to facilitate the integration of solar and other renewables onto the electric grid.
While they may appear similar, that each have subtle nuances and are applied to slightly different use cases. Here's a breakdown between the three policies:
Net Energy Metering (NEM)
Net Energy Metering allows residential and commercial customers who generate their own electricity from solar power to feed the electricity they do not use back into the grid.
When a solar energy system produces more electricity than the customer uses, the excess electricity is sent to the grid. The customer receives a credit for the excess electricity generated and can apply those credits to offset their electricity usage from the grid during periods when the solar system is not producing enough electricity to meet the customer's needs.
This typically applies to a single meter and a single customer.
Net Energy Meter Aggregation (NEMA)
NEMA, otherwise referred to as "Meter Aggregation," allows a single customer to aggregate the electricity use and generation across multiple meters on the same property or adjacent properties.
A customer with multiple meters (e.g., a property with several buildings that each have their own meter) can combine the electricity generation and usage of all meters. The combined excess generation can offset the combined usage of the meters.Meter aggregation is ideal for customers with multiple meters on a single property or adjacent properties and can improve the economics of installing a larger solar system by maximizing the use of generated electricity.
Virtual Net Energy Metering (VNEM)
VNEM is a billing mechanism that allows customers to receive credits for solar energy generated at a different location (virtually elsewhere) from where it is consumed. This is particularly important for community solar projects and multi-tenant properties.
For example, a solar system installed on a separate property (such as a community solar farm) generates electricity which is then virtually allocated to multiple customers who may be located elsewhere.
Each customer then receives a credit on their utility bill for their share of the electricity produced, even though they do not have solar panels on their own property.
VNEM allows multiple tenants to benefit from a single renewable energy system and is particularly beneficial for properties where individual tenants may not have the space or resources to install their own solar systems.
Net metering overview
| Net Energy Metering (NEM) | Net Energy Meter Aggregation (NEMA) | Virtual Net Energy Metering (VNEM) | |
|---|---|---|---|
| Definition | Credits for excess solar energy delivered to the grid for individual customers. | Aggregates usage and generation across multiple meters for a single customer. | Credits for solar energy generated at a different location (virtual) than where it is consumed. |
| Who it Applies to | Individual customers with a single meter. | Customers with multiple meters on a single or adjacent properties | Community solar projects, multi-tenant properties, or customers without suitable sites for solar. |
| How it Works | Excess energy generation offsets future electricity use. | Combines generation and usage from all meters on the same or adjacent properties. | Shares energy production among tenants based on allocation. |
| Benefits | Simplifies billing with monthly rollover credits. | Maximizes use of generated electricity by aggregating across meters. | Allows tenants to benefit from shared renewable energy systems. |