Net Energy Metering (NEM), also referred to as simply 'net metering,' is a program established by power companies to reward customers whose homes produce energy through solar, wind or other renewable sources that feed back into the grid. Through a special billing arrangement, these customers receive credit for the excess energy they generate beyond what they need to power their homes.

It is not uncommon for photovoltaic panels, for example, to produce more energy than a homeowner can use at a particular time, such as during the afternoon when they are away at work.

At other times, such as in the evening, the panels do not produce enough energy to power the home, so that power must be drawn from the utility grid. The electric meter mounted on the house will spin forwards or backwards, depending on the flow of power. It's a give and take relationship, but when the 'give' out weighs the 'take,' the customer can be assured that he or she will benefit financially from the arrangement, and will never go without power.

Net Energy Metering allows homeowners who invest in solar panels or wind turbines to recoup some of these upfront costs overtime. Imagine receiving a utility bill for $0, or better yet, a check from the power company at the end of the year! Statements from your power company also help to you track the energy efficiency of your home and the performance of your renewable energy system.

Many states have implemented NEM programs, notably California, Hawaii, New Jersey and Colorado. Check with your local power company to find out if Net Energy Metering is available in your area.

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