Solar Renewable Energy Credits are credits you receive for producing energy that can be sold to utility companies. An installed solar system generates one SREC for every 1000kWh produced. State and federal governments have set regulations on how much clean energy utility companies have to produce, making investments into solar energy for utility companies beneficial. Instead of developing their own solar systems, utilities have found it easier to just pay homeowners for their energy production. The utility companies are not paying you for the excess energy your system produces, but instead, they are paying for the ability to take credit for the clean energy your system produces.
Net-Metering is a system of debits and credits that help your utility company even out your bill. The utility bases this on how much energy you produce and how much energy you consume. You will either be credited for your energy production or debited by the utility company. Credits build when your system produces an excess amount of energy. When your system is not producing enough electricity, your bill will be debited. This gets balanced out by using the credits you built up to pay for the debit charged by the utility. Though Net-Metering is not a way to generate revenue you can use credit for other bills such as another property, family member’s, schools, and other utility customers.
SREC and net-metering together give you the best possible financial benefits of solar energy systems. Even though they are both different, when put together they are some of the many reasons why switching to solar can benefit not only you but your community.