As solar power is the most abundant renewable source of energy, solar power systems sometimes create more power than the daily capacity of the houses or buildings that they are installed in. Net metering or Net Energy Metering (NEM) is a form of incentive system that helps store this surplus power in the grid that can then be used as credit. In this way every building that has access to a solar panel can create solar powers generated electricity which poses no threat to the environment and earn revenue by selling their excess solar generated electricity to the grid.
Initially the installation of a net metering system would be more expensive than using a traditional system. In a period of 3 years the solar generated surplus electricity would be used as credit against the consumer’s electricity consumption which will result in a return on investment. This is especially beneficial due to the steady spike in cost of electricity and decrease in the cost of solar panels and solar energy systems in the recent years. Countries such as Iceland, Denmark, Costa Rica and Sweden are leading the way for renewable energy.