Alberta is known for its stunning natural landscapes, friendly communities, and abundant natural resources. However, the province is also one of the biggest greenhouse gas emitters in Canada, contributing to climate change and environmental degradation. Fortunately, Alberta has also been at the forefront of the transition to renewable energy, with net billing playing a critical role in this shift.

In this blog post, we will explore what net billing is, how it works in Alberta and the advantages and disadvantages of harnessing solar energy through this innovative system. So, whether you're a homeowner looking to save on energy costs or a business owner seeking to reduce your carbon footprint, join us as we delve into the exciting world of net billing in Alberta!

What is net billing?

Alberta’s deregulated energy market means each energy retailer may have different regulations for renewable micro-generators. However, all of Alberta works on a net billing system that is overseen by the Alberta Utilities Commission (AUC). Net billing is a billing arrangement that allows homeowners and businesses with solar energy systems to sell the excess energy they generate to their energy retailer for money. In a net-billing system electricity is usually sold back to the retailer at the wholesale cost - which is often much lower than the retail rate. Additionally, distribution and transmission fees are applied to all imported electricity. This is in contrast to a net metering system where each kWh produced cancels out each kWh consumed, resulting in the variable portion of the distribution and transmission fees (which are calculated based on the power you use from the grid) being offset by the excess electricity produced by your solar system. 

The process of net billing begins with installing a solar system on the roof or ground of a home or business (or other small-scale renewable energy source). These solar photovoltaics are connected to an inverter, which converts the DC electricity generated by the panels into AC electricity that can be used to power the building or fed back into the grid through a bidirectional meter which keeps track of the electricity imported from the grid and the excess energy exported to the grid.

When the solar panels generate more electricity than the building is using, the excess energy is sent back to the grid and the home or business owner is paid for this power. When the building needs more electricity than the solar systems generate, the account is debited for the electricity consumed from the grid.

How does net billing work in Alberta?

In Alberta, net billing is currently set up in a way the benefits you - the customer - the most. The current regulations are that home and business owners with solar systems under 150 kW will be paid at the retail rate of electricity. This means you get paid the same for the excess solar energy you generate as what you pay when you buy electricity from the power grid. This is much better than most net billing schemes where the electricity you sell is at the wholesale price, much lower than what you pay when you need to buy energy. This makes Alberta a great location to take advantage of solar power. 

Alberta is also unique in terms of net billing as the exported electricity is credited to your next monthly bill to offset electricity use. If you have leftover credits in a 12 month cycle, you will be paid a cash lump sum. Systems are limited by the size of your annual consumption in Alberta, so most savings will be in the form of monthly bill credits. Most net billing systems simply pay for all exported electricity as a lump sum at the end of the year. However, Albertans with solar panels benefit from lower monthly bills with the potential for a small cash payout yearly.

The net billing system in Alberta has a further benefit of many energy retailers offering Solar Club membership that offers rate structures for exported electricity that can earn you even more money. 

How do Solar Clubs work in Alberta?

Solar Club membership offers much higher “export” rates in the summer when more excess energy is likely to be produced by your solar system, and lower “import” rates in the winter when you are likely to be purchasing energy from the electrical grid. This is done to encourage investment in renewable energy through the use of Renewable Energy Certificates (RECs) that can be used by businesses to offset their carbon emissions. Solar Club members can also receive 2% cash back on their imported electricity which is paid as a lump sum once a year. These programs can dramatically improve the economics of going solar, especially for systems that cover close to 100% of a home or business’s electricity consumption. Just another reason solar adoption in Alberta continues to grow!

Advantages of net billing in Alberta

Alberta’s net billing program offers numerous benefits:

1. Lower energy bills

Net billing in Alberta allows homeowners and businesses to generate their own renewable energy. This helps offset the cost of electricity they consume from the grid, leading to a lower electricity bill.

2. Reduced carbon footprint

Solar is one of the best clean and renewable energy sources that does not emit harmful greenhouse gasses. By converting conventional power users to solar energy, net billing can help reduce a household or business's carbon footprint.

3. Increased energy independence

A solar net billing system paired with battery backup allows homeowners and businesses to generate their own energy and become less reliant on the grid. This increases their energy independence and offers them greater control over their energy usage.

4. Protection against rising electricity costs

As the cost of grid electricity continues to rise, net billing can help protect homeowners and businesses against these rising costs. This not only helps save money but also provides long-term stability in energy costs.

5. Increased property value

Installing solar panels and having a net billing system in place can increase the value of a home or business property. Most real estate buyers in Alberta are willing to pay more for properties with solar systems installed.

6. Job creation

The growth of alternative energy sources, including the solar photovoltaic industry, can lead to job creation in local communities. These job opportunities can be in manufacturing, installing, and maintaining solar power systems. This not only benefits the individual homeowners and businesses using net billing but also contributes to the overall economic development of the region.

7. Improved grid reliability

Distributed energy resources, including small solar systems, can improve grid reliability by reducing strain on the grid and allowing for more localized energy production. This creates a balance between supply and demand on the grid, thus reducing the likelihood of blackouts and brownouts.

8. Reduced need for energy storage

Net billing allows excess energy to be sent back to the grid, which reduces the need for energy storage and the associated costs. This is beneficial for homeowners and businesses as it can reduce the upfront costs of installing a solar energy system by eliminating the need for large battery storage systems.

9. Environmental benefits

Solar energy produced through net billing reduces the overall demand for electricity from non-renewable sources. This can help mitigate the environmental impacts of fossil fuel-based electricity generation. A solar system can earn its users the reputation of eco-conscious citizens. 

Challenges and disadvantages of net billing in Alberta

While net billing is highly beneficial to the users and the industry as a whole, it still comes with some challenges:

1. Upfront Costs

The cost of purchasing and installing solar panels can be expensive, which may be a dealbreaker for some homeowners and businesses. But, there are certain government programs and incentives that can help offset the upfront costs of installing solar panels. These programs are always updating. If you would like to skip all of the research we can do it for you. Get multiple competing Free Qualified Solar Quotes, including the incentives that are available for solar installations in your area.

2. Policy Changes

Changes to government policies and regulations regarding solar power can affect the financial benefits of the net billing program. Currently, customers need to be paid the retail rate for the electricity they export to the grid, but this could increase or decrease at any time. Staying informed on the latest trends will help you take the necessary steps at the right time.

3. Weather Dependence

Net billing relies on the amount of energy generated and sent to the electricity grid, which relies on the sunlight available. Since sunlight can vary based on weather conditions, so can energy production. Alberta receives the highest number of sunny days in Canada: 312 per year, to be precise. This means that weather changes are unlikely to affect your net billing results significantly.

4. Capacity Limits

The size of the solar panel system can be limited under the Alberta Micro-Generation Regulation. Solar systems can not be larger than a building’s annual consumption. Contacting a professional installer or contractor will help you find the best size system for your home or business. If you would like to skip all of the research, you can get multiple competing Free Qualified Solar Quotes, including the incentives that are available for solar installations in your area.

Eligibility for net billing in Alberta

It is essential to determine if you are eligible for a net billing program in Alberta. Eligibility criteria can vary depending on a number of factors, such as your location, the type of solar panel system you have, and your energy consumption patterns. Solar Clubs are available through many energy retailers, but not all. 

Eligibility criteria for net billing can change over time, so staying up-to-date on the latest rules and regulations is essential to ensure that you can take advantage of this program.

The importance of the distribution system

The electric distribution system plays a crucial role in ensuring the efficient and reliable delivery of electricity to consumers. It consists of power lines, transformers, and other equipment that transport electricity from power plants to homes and businesses.

Proper maintenance and upgrades to the distribution system are necessary to keep up with the growing demand for electricity and ensure a stable supply of power.

In the context of net billing, the electric distribution system works as a bridge between the grid and individual homes and businesses.

Conclusion: Is net billing worth it?

After learning about the benefits, challenges, and eligibility criteria for net billing, you may be wondering whether it's worth the investment. The answer is - it depends.

If you're looking to reduce your reliance on the grid, lower your electricity bills, and increase your energy independence, net billing can be a great investment. Additionally, it can help reduce your carbon footprint and increase the value of your property.

However, net billing may not be worth it if you don't have a suitable location for solar panels or if the initial cost of installation and equipment is too high for your budget. Additionally, if you don't consume a lot of electricity or your utility rates are already very low, the savings from net billing may not be significant. But you will still be getting all the other amazing benefits that come with solar power.

Ultimately, whether net billing is worth it for you depends on your individual circumstances and goals. If you're interested in exploring your options and seeing if net billing is a good fit for you, consider getting a professional on board. You can skip all of the work Free Qualified Solar Quotes tool. It gets you competing quotes and includes incentive packages available for solar installations in your area.

FAQs about net billing Alberta

What is a bidirectional meter?

A bidirectional meter measures both how much electricity you import from the grid and how much excess solar energy you export. There are two types of bidirectional meters: bidirectional cumulative meters and bidirectional interval meters. Bidirectional cumulative meters show both the amount of electricity that has been imported and the amount of electricity exported during a period of time. While bidirectional interval meters also record the imported and exported electricity, they do so at specified time intervals (usually every 15 minutes), which can be used for hourly billing rates. This is common for larger solar systems. Most micro-generators in Alberta will be provided a bidirectional cumulative meter paid for by the wire service provider upon grid connection. 

Can you go off grid in Alberta?

Yes, it is possible to go off-grid in Alberta, but it may not be a practical or cost-effective option for everyone. Going off-grid means you're no longer connected to the main power grid and are solely reliant on your own power generation, such as solar panels or wind turbines. Having said that, setting up your own off-grid power system can be expensive and requires significant planning and maintenance. It is important to do your research and consult with experts before deciding to go off-grid.

What is the payback for solar in Alberta?

The payback period for solar in Alberta can vary depending on factors such as the cost of installation, the amount of electricity produced, and the price of electricity from the grid. On average, it can take around 10 to 15 years to recoup the cost of installation through savings on electricity bills and potential earnings from net billing. However, the actual payback period can be shorter or longer depending on individual circumstances, such as eligibility for Solar Club membership.

What is the concept of micro-generation?

Micro-generation refers to the production of small amounts of electricity by homeowners or businesses through renewable energy sources, such as solar panels, wind turbines, or micro-hydro systems. These systems are typically installed on-site and connected to the local electricity grid, which allows excess electrical energy to be fed back into the grid for others to use. Micro-generators may sometimes be eligible for incentives or rebates from local governments or utilities. Micro-generation regulations vary by location and should be reviewed before installing a system.

What is considered a micro-generator?

A micro-generator is a small-scale electricity generation unit that has a capacity of fewer than 150 kilowatts in Alberta. Examples of micro-generators include solar panels, wind turbines, and small hydroelectric systems. No matter the type, micro-generators are becoming a popular option for people looking to go green.

What are the 7 types of renewable energy?

The seven types of renewable energy are:

1. Solar energy: Harnessed from the sun's radiation using photovoltaic cells to generate electricity or heat.
2. Wind energy: Generated by wind turbines that convert the kinetic energy of wind into electricity.
3. Hydro energy: Generated by harnessing the power of flowing water in dams or tidal turbines to produce electricity.
4. Geothermal energy: Generated by tapping into the natural heat of the earth's crust and converting it into electricity or heat.
5. Biomass energy: Generated from organic matter such as wood, crop waste, and animal manure, and can be burned or converted into biogas to produce electricity.
6. Ocean energy: Includes tidal, wave, and ocean thermal energy conversion (OTEC) and involves harnessing the power of the ocean's natural movement and temperature differences to generate energy.
7. Hydrogen energy: Generated by separating hydrogen from other elements in a process called electrolysis and using it as a fuel source for vehicles or power generation.

These renewable energy sources are becoming popular around the globe as a way to reduce reliance on fossil fuels and decrease global greenhouse gas emissions.

Are solar panels worth it in Alberta?

Solar panels are definitely worth it for the majority of Albertans. While the initial cost of installation can be high, the long-term savings on electricity bills and potential earnings from net billing can make it a worthwhile investment. Be it a residential or a commercial solar program, going solar can help reduce greenhouse gas emissions, increase energy independence, and even increase property value. There are well over 10,000 solar systems currently operating in Alberta.

Is it profitable to generate one's own electricity in Alberta?

Absolutely! It can be profitable to generate electricity in Alberta, especially when you take advantage of net billing and Solar Club membership.

How do you store excess energy?

If you can produce excess energy, it can be stored in batteries or sold back to the grid through net billing programs. Some people also choose to use excess energy to power electric vehicles or heat their homes with electric heating systems. Whatever the use, it's always handy to have a battery storage system onboard.

How many solar panels do you need for a house in Alberta?

The number of solar panels needed for a house in Alberta depends on various factors, such as the size of the house, electricity consumption, and the efficiency of the solar panels. According to the average power consumption in Alberta, you would require around 14 to 18 panels of 400 W each. This makes up for a solar system of around 5.6 kW to 7.2 kW. However, an assessment by a solar panel installer can help determine the appropriate number of solar panels required for a specific household.

How much does it cost to put solar panels on your house in Alberta?

The cost of installing solar panels on a house in Alberta can vary depending on system size, panel quality, and installation process. However, homeowners in Alberta can expect to pay between $11,000 and $18,000 on average for a standard installation of a 5 kW system. There may also be additional costs or incentives that could increase or decrease the overall price. It's important to get a quote from a reputable installer to get a more accurate estimate based on your specific needs.

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