Net Metering and 4 Ways Saudi Arabia can implement it

Excess solar energy needs to be stored somehow. Net metering expedites that process by running your excess electricity through the grid; reducing your utility bill or storing it for later use.

Net Metering, as a policy, is being implemented throughout the world. Any excess energy, whether through solar or wind, is being fed into the grid to offset the cost of your bill or help the utility company smooth out supply and demand.

Saudi Arabia needs to have a concrete policy in renewable energy implementation and having a net metering condition will help people from all walks of life; Residential, Commercial or Industrial all can avail of this opportunity.

The net metering policy is drafted by the local utility company(i.e SEC) which underlines how you will be credited and billed for your consumption. Under this policy, The local grid acts as energy storage for your excess electricity. The meter will track your net electrical usage( electrical consumption minus the electricity generated) and will bill or credit accordingly.

There are four ways, in which, Net Metering, as a policy, can be implemented within the Kingdom’s Jurisdiction:

Feed-In Tariff

Under the feed-in tariff agreement, the SEC will monitor electrical power through two meters; one for electrical consumption that is called the import meter and the other for electrical generation through renewable energy through the export meter.

Both of these meters are billed under different structures. The government buys extra energy at premium rates to incentivize renewable energy adoption. For example; if the electricity provided by SEC is at 1.2SAR/KWh, it will buy the electricity generated by your panels at 3 SAR/KWh.

Net Purchase and Sale

In net purchase and sale, the opposite is true. The electrical generation is bought at a lower price than the electricity that is provided to you by the SEC. You will still be paid for excess electricity that is being produced.

The utility company is only entitled to pay the cost that they would’ve paid to generate that electricity under this structure. Not a great deal for the consumer but still better than nothing.

Aggregate Net Metering

Under this agreement, different sections of the house such as home, warehouse or barn come under one umbrella of the solar panel with different meters. The energy is aggregated towards the total energy consumption of the system.

The excess energy is used under the closed-loop of the house. It is the usual system being implemented with the exception of the entire surroundings also being covered. It is the perfect system for industries that have multiple blocks acting under one entity and can be incentivized in industrial zones of Saudi Arabia.

Community Solar

Community solar is defined as having a community that can be situated in apartment-style buildings or a neighborhood suburb to connect to a solar panel pack/packs.

Each community member will be counted as an individual tenant being billed or credited under their own account. The community members will be collective owners of the solar system and own a piece of the hardware with equal or unequal stakes; given their investment.

Each side has its ups or downs, with some better suited to residential lifestyle and some commercial or enterprise. One thing is common in all of them and that is promoting the renewable energy model.

There are some nuances that should also be mentioned along with net metering agreements:

Time-of-Use Rates

Net metering agreements are offset by something called Time-of-Use Rates. The electricity that is generated by solar panels at an off-peak time is credited with decreased rates. During on-peak hours, when the demand is high, the billed is credited with increased rates.

The policy charges more during peak demand time zones. The resulting effect will show up on your bill even though you create enough energy to power your entire home.

The balance can be shifted, although, towards the consumer by investing in a mini energy storage system that can store daylight energy. By using your battery bank during the evenings instead of the grid, this offset can be restored in your favor.

Net Metering Restrictions

There are some terms and conditions which the consumer has to comply with and the utility company has to regulate. Issues such as demand and supply or gaming the system for monetary benefits should be restricted as much as possible through these measures:

Renewable system cap – A renewable system should not be above 1 MW or any number deemed suitable for the demographics of installation,

Technology barriers – Old and inefficient technologies cannot be complied with.

Renewable energy sources: instead of net metering agreements for solar or wind energy-related systems, all renewable energies should be encouraged such as biomass, hydro, etc.

Conclusion

Saudi Arabia has to take some bold measures in order to achieve its 2030 vision. Changing from fossil fuel economy to an economy being supplemented by renewable initiatives will take some visionary execution.

By implementing these policies and terminologies, Saudi Arabia can slowly, yet steadily rise to Paris Climate Accord and Vision 2030. Killing two birds with one stone should be the ethos of a massive economy such as KSA. Ethraa will help KSA transition into a renewable haven for generations to come.

Share the Blog

Leave a Reply

Your email address will not be published. Required fields are marked *