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Frequently Asked Questions

What is a REC?

REC stands for Renewable Energy Credit, which represents the delivery of 1 megawatt-hour of renewable energy to the grid and all associated environmental benefits created by displacing 1 MWh of conventional power.

Essentially, a REC is a commodity you receive for being environmentally friendly. For every megawatt-hour you produce with your solar panels and send to the grid, you receive one REC, which you can then sell at a price set by the Illinois Commerce Commission and the Illinois Power Agency.

What is Net Metering?

Net metering (NEM) is a policy that allows owners of solar energy systems to receive credit for electricity they export to the grid. Under net metering, solar customers reduce the amount of electricity needed from their utility by generating their own power, and utilities must buy any excess electricity not consumed on site - normally at a ratio of 1:1, meaning a kilowatt-hour exported equals a kilowatt-hour credited. State-mandated net metering rules exist in 41 states, plus the District of Columbia.

For example, when a rooftop solar system produces more electricity than a home or business uses, the extra power is fed into the grid and can serve other customer loads nearby. When that happens, the customer's meter runs backwards, providing a credit that can be used during periods when power consumption exceeds solar energy generation. At the end of the billing cycle, customers are either charged for their net electricity usage or may have remaining credits that can be carried forward and applied in subsequent billing periods.

Basic Tenets of Net Metering:

  • A requirement that certain utilities, such as investor-owned utilities, offer net metering to customers
  • A system size limit for residential (e.g. 25 kilowatts) and commercial (e.g. 2 megawatts) systems
  • A requirement that utilities develop a net metering tariff that credits customers for any excess power production that exceeds on site power consumption, instructions for how utilities should carry over excess credits
  • A clause that prohibits discriminatory rates as well as additional fees or charges for net metering customers.

What is a PPA?

PPA stands for Power Purchase Agreement. See the document below for further information.



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