BPSC 69th CCE Prelims General Studies · Question 39 of 144

Correct — C, a billing mechanism for solar energy by consumers for the electricity they add to the grid. Net metering is an electricity-billing arrangement, not a device and not a fuel. A household or institution that installs a rooftop solar photovoltaic system becomes a prosumer — a consumer who also produces — and is connected to the distribution network through a bidirectional meter that counts two flows separately: units drawn from the grid and units pushed back into it. The bill is raised on the net of the two. If a household imports 400 units in a month and exports 250, it pays for 150; if it exports more than it imports, the surplus is not lost but banked as energy credit and carried into later billing cycles, to be settled at the end of the settlement period on terms fixed by the State electricity regulator. The effect is that the grid works as a free storage battery. That matters because solar generation peaks around midday while a home's demand peaks after sunset, so without either batteries or an export arrangement much of the generation would simply be wasted. Net metering removes the need for costly battery storage and values the exported unit at the retail tariff the consumer would otherwise have paid — which is precisely why it made rooftop solar financially attractive to Indian households and why it is the mechanism named whenever rooftop solar policy is in the news. Two operational details are worth carrying. First, banking is not indefinite: unadjusted credits left at the close of the settlement year are bought out at a rate the regulator prescribes — commonly a wholesale-style rate rather than the retail tariff — so a household that grossly oversizes its system is paid less for the excess than it saved on the units it displaced. Second, the arrangement is a right against the distribution licensee rather than a favour: the consumer applies for grid connectivity, the licensee sanctions capacity within the ceiling the regulator has set, and the bidirectional meter is installed and sealed like any other billing meter.

• (a)the installation of CNG kits in motorcars — A CNG kit is a piece of automotive hardware — a cylinder, regulator and injection system retro-fitted so a petrol engine can run on compressed natural gas. It is promoted through excise and registration concessions and through the spread of CNG stations, not through any metering arrangement. Nothing here involves a consumer feeding a commodity back into a network, which is the whole point of a 'net' measurement.
• (b)the installation of water meters in urban households — This is the most tempting wrong option because it is the only other one with a meter in it, and metering urban water supply is a genuine policy debate under urban-reform programmes. But a domestic water meter records a single, one-way flow into the house. There is no export of water from a household back into the municipal main, so there is nothing to net off, and the arrangement would be plain metering rather than net metering.
• (d)the use of piped natural gas in the kitchens of households — Piped natural gas is supplied to kitchens through city gas distribution networks awarded by the Petroleum and Natural Gas Regulatory Board, and is measured by an ordinary one-way gas meter. Like the CNG option it is a fuel-substitution policy, promoted by expanding the pipeline network rather than by changing how a bill is computed, and again the household is only a receiver, never a supplier.

Electricity distribution was designed to move power in one direction, from the grid to the consumer, and the meter existed only to count what arrived. Rooftop solar breaks that assumption: the same premises now generate power, and generation and consumption rarely coincide in time. Three billing designs answer that problem and they must be kept apart. Under net metering, import and export are measured separately and the consumer is billed on the difference, with surplus banked as units. Under gross metering, the entire solar output is exported to the distribution company at a fixed feed-in tariff, while the household separately buys everything it consumes at the ordinary retail tariff — two independent transactions rather than one netted bill. Under net billing, or net feed-in, export is credited in money at a rate lower than the retail tariff, which sits between the other two. Net metering is the most generous of the three to the consumer, because an exported unit is implicitly valued at the full retail tariff, and it is correspondingly the least attractive to distribution companies, which lose sales volume to their best-paying consumers while still having to maintain the wires that make the arrangement possible. That tension is why the rules are contested and why they differ from State to State: net-metering regulations, including the capacity ceiling and the settlement terms, are made by each State Electricity Regulatory Commission under the Electricity Act, 2003.

You can answer this without ever having read a line of energy policy, and that is worth practising because the examiner has reused a familiar UPSC stem. Take the term apart. 'Metering' says the subject is measurement and billing, which immediately rules out anything that is a device or a fuel — a CNG kit and a piped-gas connection are both hardware and both fail on that test alone. 'Net' says two quantities are being set off against each other, so the subject must involve a flow in each direction. Now look at the survivors: water into a house is one-way, and no household sends water back into the municipal main, so option (b) has nothing to net. Only option (c) describes a two-way flow — electricity drawn from the grid and electricity added to it. The single discriminating idea is bidirectionality, and among ordinary households only rooftop solar creates it. A second useful check is scale of relevance: net metering appears in the news attached to rooftop solar targets, discom objections and State regulatory orders, never to vehicle kits or municipal water. Note also that the answer says 'billing mechanism' in so many words — when an option restates the definition of the term in plain language while the others describe unrelated infrastructure, that option is almost always the intended one.

• Net metering: a bidirectional meter records import and export separately and the consumer is billed only on the net import, with any surplus banked as energy credits and settled at the end of a settlement period fixed by the State regulator.
• Gross metering is the contrast to hold: the entire solar generation is sold to the distribution company at a fixed feed-in tariff while the consumer buys all consumption at the retail tariff; net billing credits exports in money at a rate below the retail tariff.
• The economic point of net metering is that it uses the grid in place of a battery — solar output peaks at midday while household demand peaks in the evening — so the household avoids the cost of storage and the exported unit is effectively valued at the retail tariff.
• A household with rooftop solar is a 'prosumer', and rooftop solar photovoltaic units are a classic distributed energy resource — generation connected at the distribution level rather than at the transmission level, alongside battery storage, biomass generators and fuel cells.
• Rooftop solar in India is promoted through the Ministry of New and Renewable Energy's Grid Connected Rooftop Solar Programme; the National Solar Mission's revised target of 100 GW of solar capacity by 2022 included 40 GW to come from rooftop installations.
• Net-metering rules — the capacity ceiling, the banking period and the settlement rate — are framed by each State Electricity Regulatory Commission under the Electricity Act, 2003, which is why the terms a rooftop consumer gets in Bihar, Gujarat or Kerala are not identical.
• The standing objection from distribution companies is a cross-subsidy argument: rooftop solar is adopted mostly by higher-tariff urban and commercial consumers whose payments cross-subsidise poorer ones, so netting their bills away shrinks the discom's revenue while leaving it to maintain the network the prosumer still relies on after sunset.

• Reading 'metering' as hardware: net metering is a billing rule, and the bidirectional meter is only the instrument that makes it possible
• Confusing net metering with gross metering — under gross metering nothing is netted; generation and consumption are billed separately
• Assuming the rules are uniform across India, when the ceiling capacity and settlement terms are set State by State

This is one of the questions BPSC lifted almost intact from a UPSC paper — UPSC asked the identical 'sometimes seen in the news in the context of promoting' stem in 2016, and BPSC reused it in 2023 with the options shuffled and one distractor swapped. That tells you two things about preparation: BPSC's current-affairs terminology questions are worth mining from UPSC's back-papers, and the safest way to answer them is by parsing the term rather than by recalling a news item, because the phrasing of the correct option changes between the two papers even when the concept does not.

• practice — not a real PYQ

  Under a net metering arrangement for rooftop solar, what does the consumer's bidirectional meter record?

  • (a)Only the electricity generated by the solar panels
  • (b)Only the electricity exported to the distribution grid
  • (c)Both the electricity imported from the grid and that exported to it, with billing on the difference
  • (d)Only the electricity imported from the grid, as with an ordinary meter

  Answer(c) Both the electricity imported from the grid and that exported to it, with billing on the difference — surplus export is banked as energy credits for later billing cycles.

• practice — not a real PYQ

  Which of the following best describes 'gross metering' for a rooftop solar consumer?

  • (a)Export is set off against import and only the net is billed
  • (b)The entire solar generation is sold to the distribution company at a fixed feed-in tariff, while all consumption is bought at the retail tariff
  • (c)Exported units are credited in money at a rate below the retail tariff
  • (d)The consumer is disconnected from the grid and relies on battery storage

  Answer(b) The entire solar generation is sold to the distribution company at a fixed feed-in tariff, while all consumption is bought at the retail tariff — two separate transactions, with nothing netted.