Net metering and microgeneration in Canada

Net metering and microgeneration programs let a building with its own generation, usually solar PV, connect to the grid and receive credit for the electricity it sends out. When the system produces more than the building uses, the surplus is exported and credited; when it produces less, the building imports power as usual. How exports are credited, how large a system can be and how you apply all depend on the province and the utility, so the program rules shape how a system should be sized.

How it works on a typical day

A grid-connected building with solar PV does not store its surplus. It exchanges power with the grid continuously:

During the day, the building uses the solar power first. If production exceeds the building's load, the surplus flows out to the grid.
At night, or on dull days, the building imports power from the grid.
A bidirectional meter, or a pair of meters, records energy imported and energy exported separately.

The billing arrangement then decides what the exported energy is worth. For the system side, see how a building solar PV system works.

Export by day, import by night. On a sunny afternoon the building uses solar power first and the surplus goes out through the meter to the grid, earning a credit. In the evening the building imports from the grid as usual. The meter records both directions, and the program rules decide what the exports are worth.

Net metering vs net billing

The terms are used loosely, but the difference matters:

Net metering in the strict sense credits each exported kilowatt-hour at the same value as an imported one, at least for the energy part of the bill. Credits are carried forward and used against future consumption, often over a twelve-month cycle.
Net billing, or similar arrangements, credits exports at a different rate from imports, such as a wholesale market price or a set export rate. Imports are billed normally.

Same meter, different value. In both arrangements the meter records imports and exports separately. The difference is the credit: net metering values an exported kilowatt-hour like an imported one, while net billing credits exports at a separate rate set by the program.

In both cases, exports usually offset only some parts of the bill. Fixed charges, demand charges and some delivery charges may still apply in full. Read the program rules to see which charges a credit can reduce.

How it differs by province

Program names, limits and credit rules differ across the country and change from time to time. The outlines below are general; always check the current rules with your utility and the provincial regulator.

Alberta

Alberta's Micro-generation Regulation allows customers to generate electricity from renewable or alternative sources to meet all or part of their own annual consumption. The regulation distinguishes smaller and larger micro-generators: in broad terms, smaller systems receive credit for exports at their retail energy rate and larger ones at the wholesale market price. In Alberta's competitive market, the retailer you choose affects the energy rate, and some retailers offer plans designed for solar customers. Applications go through the local wire services provider.

British Columbia

BC Hydro and FortisBC each operate net metering programs for customers with small renewable generation sized to their own needs. Exports are credited against future consumption, and the programs set rules for system size and for how any surplus is treated at the end of the annual cycle. Program terms have been revised in recent years, so check the current terms before sizing a system.

Ontario

Ontario's net metering framework, set out in provincial regulation, allows customers with renewable generation to receive credit on their bills for energy sent to the grid, with credits carried forward for a limited period. The local distribution company handles the connection. Ontario has also explored and introduced variations, such as arrangements involving third-party ownership, so ask your distributor what options are available.

Other provinces

Most other provinces and territories have net metering or similar programs through their utilities, with their own size limits and credit rules.

Sizing to the program

Most programs expect a system sized to offset the building's own consumption, not to generate for sale. Exports beyond that may earn little or nothing, or may not be permitted. That makes the building's annual use and its daily pattern central to sizing:

A building with high daytime use can use most of its production directly, which is usually worth more than exporting.
A building with low daytime use exports more, so the export credit rate matters more.
Planned changes, such as heat pumps or EV charging, will raise consumption and may justify a larger system.

The application and connection process

Check eligibility and program limits with the utility or wire services provider.
Design the system and prepare the documents the utility requires, often a single-line diagram, equipment data and a site plan.
Apply for interconnection. The utility reviews the impact on its system. Larger systems may need a more detailed study and take longer.
Obtain the electrical permit and any building permit for the roof or structure.
Install using a licensed electrical contractor, followed by inspection.
Meter change and authorization. The utility installs or reprograms the meter and authorizes the system to operate. Do not energize before this step.

Do not connect before approval. Operating a grid-connected generator without the utility's authorization can create a hazard for utility workers and break the terms of your service. Wait for written approval and the meter change.

Questions to ask your utility or retailer

Which program applies to our account, and what is the maximum system size?
How are exports credited, and at what rate?
Which parts of the bill can export credits reduce?
How long do credits carry forward, and what happens to a surplus at the end of the cycle?
What documents are needed for the interconnection application, and how long does review take?
Will the meter need to be replaced, and is there a fee?
Are there rules on adding batteries or expanding the system later?

A typical case

A small manufacturing business in Alberta considers a rooftop solar system. Its electricity use is high during weekday working hours and low on weekends. Analysis of its interval data shows that on weekdays almost all solar production would be used on site, while on weekends much of it would be exported. The design sizes the system below the building's annual consumption, keeping it within the micro-generation rules, and estimates the value of weekday self-consumption and weekend exports separately, using the retailer's actual rates. The business also checks with its retailer whether a solar-oriented plan would improve the value of its exports.

How ehZee can help

As part of our solar PV system design work, we review your consumption data and the program that applies, size the system to suit, and prepare the technical documents for the interconnection application. For systems that pair solar with storage, see battery energy storage for buildings.

Common questions

Will the utility pay me cash for surplus power?

Usually credits are applied to your bill rather than paid out. Some programs pay out or settle surpluses at the end of an annual cycle, often at a lower rate. Check your program's rules.

Can a landlord share solar credits with tenants?

It depends on how the building is metered and the program rules. Where tenants have their own meters, sharing credits can be difficult. Ask the utility early.