Florida, “The Sunshine State,” has been the ideal place for home and business owners to benefit from the sun to power their property. The most prominent attraction to harnessing the sun’s power is net metering (NEM). Net metering means that the excess energy produced by your solar panels will be stored within the local utility power grid and credited back during the evening hours or cloudy and overcast days. A House Bill, HB 741, was recently passed to end net metering and will significantly affect Florida solar customers.
The benefit of net metering
A large benefit of switching to a solar energy system is to reap the financial benefits of lowering or eliminating power bills. The local utility company will accept new NEM applications from a residential or commercial solar customer for inspection. Upon approval of the system, they will then be linked to the grid.
Customers with net-metered solar energy systems in Florida can receive a credit for each kilowatt (kW) of energy produced by their system. Their energy bill will reflect the total quantity of electricity utilized minus the amount generated each month. If they generated more energy than consumed throughout the month, the credit will be stored and applied to their next statement.
Net metering offers large savings and incentives for all Florida solar customers and helps offset the installation cost of a solar energy system.
How HB 741 will affect Florida residents
HB 741 will disrupt the Florida economy and will have an impact on all Floridians. The current solar residents will not be directly impacted by the bill right away, but anyone interested in a having solar energy system installed will need to act quickly.
HB 741 is scheduled to take effect on July 1, 2022, however current solar homes and businesses will be grandfathered in for 20 years. According to the bill, any Florida resident deciding to have solar installed, must do so by 2024. Although the grandfather clause will be in place, utility companies could still charge a fixed rate to grid connected solar energy systems beginning in 2026.
Florida’s current credit per kw/hr. equals the value of the excess energy. The following time frame will lead to the elimination of billing credits.
- Jan. 1, 2024 – Dec. 31, 2025 credit reduced to 75% of the current value
- Jan. 1, 2026 – Dec. 31, 2026 credit reduced to 60% of the current value
- Jan. 1, 2027 – Dec. 31, 2028 credit reduced by 50% of the current value
- Beginning Jan. 1, 2029 the billing credit will be eliminated. Solar customers will pay the full cost of electric service and will not be cross-subsidized.
Solar energy installation companies will also be hit hard from the passing of HB 741. According to state Sen. Lori Berman, a Democrat from Palm Beach County, Florida’s solar industry could be impacted by the possible loss of 40,000 jobs.