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Net Metering Is a method used to by local distribution companies to credit customers for electricity the customer generates from their own power generator system.  As your system collects electricity either from solar energy (using photovoltaic PV modules) or wind turbine, the electricity is routed directly to your home or business for use as the primary energy source.

A Grid-Tie system will automatically distribute the energy to anywhere it is needed in your home or business.  During times you are generating more electricity then you are using.  The system will redirect all the excess electricity back into the hydro grid for the electrical distribution company to direct to other areas on the grid where the electricity is needed.  This will result in your hydro meter to run backwards.  

While your meter is running backward you are building a credit.  In the case of a photovoltaic system, as the sun sets.  You begin to use more energy from the grid and use credit you have built up during the day first.  This results in significant drops in your energy bills.  Saving you money!

On bad weather days the system will automatically deliver electricity from the grid as you are accustom.  The transfer from your system to your local utility is completely seamless.  The use of a Grid-tie system also eliminates the need for batteries, as a result dropping a large cost of initial investment.  Perfect for residential or commercial use, a grid-tie system will lower your operating cost and pay for itself.

The section below created by SHARP provides a 4 step explanation of a Grid-tie system on a residential home.  Commercial systems are similar however are larger and sometimes more complex.

Residential Grid-Tie Photovoltaic (Solar) Power Generation System Solar Power Generation Systems begin with the solar module. Solar or Photovoltaic (PV) modules capture solar energy and generate direct current (DC) electricity. Inverters (power conditioners) convert DC into AC (alternating current) to run your appliances and any electrical equipment. Photovoltaic (Solar Cell) Modules A photovoltaic module transforms solar energy into electricity. Inverter (Power Conditioner) The inverter converts DC electricity generated by the photovoltaic module into AC electricity and automatically controls the entire system. Indoor Distribution Panel The panel delivers appropriate electric loads to household electrical appliances. Watt-Hour Meters The Kilo-watt hours your system sends to the grid is subtracted from the total you have used and you are billed only for the net difference. This diagram illustrates the flow of electricity of a Grid-Tie generator system.