How do I sell solar power to a utility company ?

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If you’ve taken or are thinking of taking the energy-efficient step of installing solar power at your home or business, know that this move can be cost-effective, too. The initial investment for a solar panel system can be quickly paid for by selling your surplus energy to a utility company.

The government requires 42 states and the District of Columbia to purchase surplus power from consumers. The way to take advantage of this process, and the subsequent rate you will receive for your surplus energy, varies by state. Here is a quick guide to getting the most out of your extra solar generated energy.

Technical Requirements

The first thing you’ll need when attempting to determine how much energy you’re generating and how much of that energy you can sell is to check your energy measuring equipment. Most existing homes and businesses will have a power meter attached to them with gauges that run forward and backward, tracking energy use. Inside the meter should be what is known as an ‘inverter.’ The inverter allows the company to measure how much power you are generating.

Interconnection Specifics

Each utility will have different interconnection standards to allow you to sell power back and forth. The best thing to do is to contact the utility directly and find out what type of interconnection terms and policies they offer. As part of the interconnection agreement, some states require you to purchase home owner’s insurance, for example, or obtain certain permits.

Net-Metering Rates

Although some utility companies may have their own specific policies, in general there are a few standard methods of reimbursement for surplus power, known as net-metering. If you generate more power than you use from the electric company in a given month, you will see a credit applied to your bill. At the end of a year, if you have a surplus of energy, you may be paid in cash, at a wholesale rate, per kilowatt hour. What this means is that the utility will pay you what it costs to generate the power, and not the end-user mark-up.

For example: if a kilowatt hour costs 2 cents an hour wholesale, but is sold for 9 cents an hour, you would be paid 2 cents per hour, not 9.

Becoming an Independent Power Broker

Most home installations of solar panels will generate a modest surplus. However, if you have invested heavily in solar technology, in New Jersey you can become an independent power broker and sell groups of 1,000 kilowatt hours to utilities. The price of the hours is not fixed, but can range up to $265 per 1,000 kilowatt hours. Some individuals, like Carl Baldino of New Jersey, clear $3,000 annually in profit from the generation of these extra kilowatt hours.

Specifics in Your State

An excellent way to keep up to date on developments in energy regulation is to visit www.dsireusa.org, which is the website for the Database of State Incentives for Renewables & Efficiency. This website tracks the passing of laws and how those laws affect the buying and selling of energy for all 50 states in the union. A variety of states, including Arizona and Indiana, offer either tax incentives or rebates to customers who are energy efficient.

38 thoughts on “How do I sell solar power to a utility company ?

  1. Pingback: Cost effectiveness of residential solar energy systems

  2. bill

    you can not sell electricity for a profit—-the utility company determines the amount they pay you for your electricity, which will be .oooo1 cent per kwh—-this is A typical of what is going on in this country—–the big utility companies buy the politicians to write the laws so there is no incentives to produce clean energy unless they are making it, so they can control it, and stay in power—- any other site that tells you different is lying and there are hundreds of clean energy sites doing so, and that is A typical of what is going on—-the majority of the so called good guys, are know better that the rest of the trash that is out there telling lies— IF YOU DO NOT BELIEVE ME DO THE RESEARCH YOURSELF, I HAVE.

  3. admin Post author

    Thanks for Your comment. I respect Your opinion and i think that power should be choose for energy efficiency and autonomy first and second if you can obtain some credits from utility companies is a great thing too.

  4. Grish

    I try to sold solar power to big company before this, they pay us only .000007 cent per kwh. This very cheap when compare with solar panels and other utility solar panels price (battery, base, installation). 1 year after we deploy solar panels, we design to sold all solar panels out because of maintenance cost (heavy win).

  5. admin Post author

    Sure Grish, but the main reason to buy solar panles is for energy efficiency and not to resell it to utilities cmpanies.

  6. Scott Brooks

    I was watching the show Hidden Potential on HGTV and the hosts suggested adding solar panels to a house a couple was looking at. They were very “green” and chose the house with solar panels. They also mentioned selling power back to the utility company. I never heard about this before so I searched Google and found your site. Interesting stuff.

  7. Jasper

    A bit behind other countries, the UK Government is to introduce a Feed-in tariff from April 2010. Small-scale energy producers will be offered a fixed, premium rate for renewable energy fed-in to the grid (previously, although some UK microgenerators received a payment for selling their electricity, this was not guaranteed). This energy will be bought by the utility companies which are obliged under the legislation to buy the units of energy over a set number of years.

    Some are saying that the tariff levels have been set too low and that existing microgenerators will actually end up receiving less.
    The scheme does not initially embrace solar heating (we will have to wait till 2011 for this), but a company such as SolarUK which installs PVs as well as solar thermal systems could benefit in the long run if there is an increased uptake in solar energy.

  8. Pingback: Basic Steps to Plan Your Solar System

  9. Tom G.

    I live in the Southwestern part of the United States where we have lots of sun and solar installations. My utility pays between $.17 and $.20 per kWh A.C. under what is known as a performance based incentive. The only restrictions are that the solar system must be greater than 20 kW A.C. and the agreement must be for between 10-20 years which determines the payback rate.

    I believe selling excess solar does work out at these level if you have sufficient space for a 20 kW or larger system.

  10. admin Post author

    @Tom

    Thanks for sharing your experience. If you have a farm or have a big garden, than a 20 Kwatt solar system would work fine.

    Where do you live?

    Thx

  11. Tom G.

    admin said [in part] where do you live?

    I live in the very western part of the state of Arizona and the utility which serves this area is UniSource Electric. The name of the town is called Lake Havasu City and is the home of the London Bridge. It is a wonderful community with a HUGE boating crowd during the summer months when temperatures can climb to 110-115+ degrees F in July, August and September.

    Not much farming or gardening at those temperatures but great for boating, swimming, water skiing and enjoying a chilled beverage on the lake.

    Over 300 days of sunshine every year so solar is king in this area. You can learn more about the city at this address.
    http://www.golakehavasu.com/

    You should come visit our city some time :-)

  12. admin Post author

    Cool!!! Arizona is the best U.S. State to use soar power….a lot of good solar radiations!!

    Thx
    Regards

  13. Clayton

    It’s a huge benefit in the use of solar energy, just comming off the grid to me seems economically feasible. Until we discover that we as a society has reached our fossil-fuel and coal-fuelled energy useage peak, till theres none. Then we as a society will be forced to except solar energy. Think Green now, before its to late.

  14. Danny C

    I don’t know if this will work you may save sum money it sounds like a lot of hard work and alot of money please someone prove me wrong

  15. dave

    We operate a grass-fed only cattle ranch in Oregon and are very interested in becoming more energy efficient. Solar systems that have recently been quoted to us are between 54 to 56 thousand dollars to install and we are thinking that this is a wildly high price for a solar system. We could use some honest help in determining how to make becoming more energy efficient possible without paying to much. Tax incentives and possible selling the small excess in power generated back to the utility company in no way would cover the costs associated with installing and maintaining a system at the above quoted price.

  16. Nigel

    Does anyone happen to be aware of what regulations are in place in AZ to compel e-utility companies to install new power lines to connect residences to the grid that are producing substantial surplus solar power ? Some of us have installed solar systems in locations where there is no current grid service, but might be inclined to sell surplus power once connected to the grid if the e-utility co.s are obliged to pay the line connection costs.

  17. FNetV1

    Dave, I agree with you. Over $55,000 for solar panel installations? The price that I find acceptable is $550 per 240 watts 12vdc solar panel, so if we were to divide $55,000 (the price that was quoted to you by an installer that wishes to rip you off) by $550 (the price that I pay per 240 watts modules (two 120w blocks/panels) would equal to 100 panels at 240 watts each, which is a total of 24,000 watts (24kWh) which is enough to run like 3 to 4 family houses/apartments. with loaded equipments to the top, and up to 8 family apartments with moderate to low/basic equipment loads (220w fridge, 180w 42″ LCD TV, 200w computer system, 90w ceiling fan and a 25w floor fan).

    So, what are your requirements? If it is like 5,000 watts, then 21 panels at 240 watts each (or 42 panels at 120 watts each) would do the trick and most certainly will power everything you own in your house, plug keeping a decent battery bank fully charge for night time., 42 panels of 120 watts each in total would cost you about $11,550 and I am pretty sure if you intention is to buy that much, the supplier would even give you further discounts.

    So, dont let people rip you off, in know that your installer probably wants to triple its profit per panel (you might as well just pay his rent for a whole year!, – ridiculous pricing).

    If I were you, I would just do it my self, that way, I know for sure that I wont be paying any person’s rent. Installing solar panels is very easy any ways, that it doesn’t justify the kind of exorbitant fees some of these installers charges. You can learn all what you need to know about installing solar panels your self by doing google searches.

  18. dave

    in SoCal, you have to have a Edison certified contractor, enter a power agreement with Edison, (which gives them the right to inspect and shut off your self-generating power system at any time) and have a city inspector for a city permit to install a simple grid system for your residence.
    i find it interesting that right now, on the grid, Edison is only responsible for power to by breaker box, i am responsible for everything past that in my home. yet, if i generate free power from the sun they can come and shut me down. and, if i were to only use one light bulb in my house for a month, my useage is still okay (i still pay the base line fees). so, if one were to disconnect the high load circuits in your home and move them to another circuit breaker panel and power that with solar-only, it would be legal in my mind.
    my whole plan is to make my utility bill $1 – forever. you can’t patent nature, you can’t claim the sun.
    i know i can install panels myself. DC to AC? really?
    its not rocket science. $8 grand?

    how about $900?

  19. Orkan

    Can any one give show/send me a list of energy providers that do buy back solar or wind energy? At reasonable rates that is .10+/kw.

  20. Greg v

    can you tell me what is a fair price to pay an agragator for energy produced with PV.
    is 10% the going rate. is there cheaper rates.
    thanks,Greg

  21. Dan

    If you pay over $55000 for solar installation then you’re getting ripped of by at least 80% of that price. You can buy a good 180w solar panels around $400 to $500 each that does not include installation, however you can install them yourself people do it all the time. There are also many different solar panel wattage but the higher the wattage and quality of the solar panel the more expensive it’s gonna be I might be wrong but I believe the highest solar panel you can buy(unless you make one yourself) is 180w. So use this info you’re own custom calculation in price, I hope this info helps for pricing. Also if you do go solar congrats now here is an important tip, they require a lot of care and maintenance just like a dog. They need to be washed more than twice a week or if left unattended then they will eventually loose their quality in performance I’ve seen it happen to a lot of people.

  22. Jim Kinney

    Since 2006 Tennessee residential and commercial utility customers can get paid for producing power with solar and wind.
    In most areas more that double the cost to purchase from the utility.

  23. Joel

    Can I make my own mini grid and sell the power directly to my neighbors? I would charge a very fair price.

  24. Susan Neice

    I am in Florida want to set up helex wind mills on my land and sell to power company has any one done this here or know where to buy helex wind mills.

  25. E Money

    My mother owns 5 acres of undeveloped land with strong exposure adjacent to the home where she lives in NorCal. With real-estate in her area taking a substantial hit, I’m curious as to the prospects of not merely powering her home but generating a revenue stream from surplus energy generated. I’m not sure of regulatory restrictions at this point, but where can I go to better understand the feasibility of an investment.

  26. RB28

    We installed a 4.6Kw system 15 months ago. The system was designed to provide 100% of our needs electric power. About year before the system was installed we conducted an energy audit. Before we purchased our system we worked hard to reduce the amount of electricity we consume. Our conservation efforts combined with some tree trimming has resulted in a surplus (~15%). Instead of Selling our excess at whole sale prices we use the excess to replace other energy source. For example, I installed electric baseboards in a bedroom and an electric water heater in the kitchen. Our goal is to reduce natural gas usage by 20%.

  27. manny

    Looks like the admin is not answering the questions no more.

    Maybe, he bailed out of solar just like Solyndra.

  28. Mike

    I agree with a lot of what Bill is saying. These big ppl in power such as the world bankers, carnagi’s, rockafellers, control our energy supplies. Oil, electricity etc.. A movie/documentary this past november came out explaining much of how it has and still is happening. If you just follow the money you will see.. If there is free clean energy, how will these major oil and electricity companies get their hundred billion dollars. Therefore, they will do anything to supress things that threaten their money. IF YOU WANT TO RESEARCH IT AND LOOK IT UP URSELF WATCH THE MOVIE CALLED “THRIVE”. There is clean free energy out there, there is a cure for cancer and diseases. The government will supress all of this so that they can have they payroll and get their paychecks!! by supressing cures they sell more medicine, by supressing energy they sell their oil/electric, by surpressing truth they control us.

  29. art

    well solor panels is a good idail but i have come up with a idail for free electric if you bye a generator head 24kw the one i am looking at is $700 then bye a 25 house power electric ac motor $2000 my research shows that generator head gives you 24 kw and the motor uses 12,360 watts and you get 11,640 watts free what do you think about this idail…

  30. Brian

    I live in Northern Indiana, and I figured out that just to break even on power consumption and to barely be able to go off grid; I would need to install 15KWh of panels on my home. I don’t have enough roof space to do that, let alone install enough to sell back to my utility company. LOL.. I looked at my utility bill and my average monthly consumption over the last thirteen months has been 2100 KWh with a peak last November of 3240 KWh.

    So maybe that person who said they were quoted $55k to install the panels had a large home with an extremely high HVAC energy consumption.

  31. Geoff

    We’re a rural church in Connecticut with a seven acre field that gets direct sun all day. It’s been suggested to us that we install two or three acres of solar panels that could provide for all of our use, and also let us sell a large amount to the local utility (CT Light and Power), and we would plan of using the proceeds to fund our work with disadvantaged people. Any sources of information that would particularly apply to a case like ours? Thanks!

  32. Pat

    We moved into our home which had solar panels already installed. Our electric bill is a couple bucks a month. Southern California Edison is suppose to send us a check for the energy we produce for them but every time we call they don’t seem to know anything and say they will get back to us.
    We do not store the energy so they take what we don’t use. Please advise. How to we check this out . Thanks

  33. robert

    so happy to find this site . I need help, Pat , Iam on the same boat , or worst I dont know who is getting, my solar energy, i used to get a check twice a year bur for the past year I got nothing and dont know how to find out who is getting it please if you guys know how can i find this out contact me at gigi25262010@hotmail.com I really appreciate very much thanks robert

  34. Mike

    @Pat

    The utility company should credit you on your next bill. If you don’t use all of your credits, they will send you a check at the end of the year.

    First i’d check to make sure that they are crediting your electric bill.

  35. Elliander

    Unfortunately, in Illinois and Missouri we can’t sell power to the Utility. We have Net metering, but at the end of the year any surplus is voided. This essentially means that no matter how much power I produce the Utilities will get that for free and will never have to pay me a cent which is tantamount to government sanctions theft of service.

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