Grid-Connected Distributed Generation: Compensation Mechanism Basics
Zinaman, Owen R., Alexandra Aznar, Carl Linvill, Naïm R. Darghouth, Timon Dubbeling, Emanuele Bianco
This short report defines compensation mechanisms for grid-connected, behind-the-meter distributed generation (DG) systems as instruments that comprise three core elements: (1) metering & billing arrangements, (2) sell rate design, and (3) retail rate design. This report describes metering & billing arrangements, with some limited discussion of sell rate design. We detail the three possible arrangements for metering & billing of DG: net energy metering (NEM); buy all, sell all; and net billing.
Year of Publication
Electricity Markets and Policy, Renewable Energy, EAEI Renewable Energy, Program Analysis and Assistance