Article by:
Nikki Chi and Austin Young
July 27, 2023
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Virtual Net Metering: The Role of Virtual Grid in Shared Solar Billing

In an era of growing environmental awareness and increasing demand for renewable energy, shared solar projects have gained traction as a viable solution for multifamily residential and multi-unit commercial properties alike to share access to clean energy. But, the traditional model of net metering, where solar energy generated by a photovoltaic (PV) system is directly offset against the consumer's electricity consumption, poses challenges when it comes to shared solar arrangements. Enter virtual net metering or VNEM, a utility rate tariff that enables property owners to share the benefits of solar with multiple residents. However, VNEM doesn’t provide a system or even instructions on how to equitably distribute the benefits and bill for solar. That’s where Ivy’s Virtual Grid comes in. In this blog post, we will delve into the role of Virtual Grid in shared solar billing and its impact on virtual net metering.

An Intro to Shared Solar Billing

If you're considering implementing multifamily solar, understanding shared solar billing and the policies that enable you to offer solar energy to your residents is crucial. Thankfully, in accordance with California's public utility policy (CPUC Code 2868) and regulations, multifamily buildings can operate as independent solar producers, distributing solar energy directly to their residents. Let's take a closer look at how this works and how it can benefit both property owners and residents.

What is Virtual Net Metering?

In a single-family home equipped with solar panels, homeowners often generate more solar energy than they can consume. This surplus electricity is fed back into the utility's power grid, and homeowners receive credits on their electric bills. Known as Net Energy Metering (NEM), this practice is a key component for homeowners to collect a return on their investment.

But, NEM doesn’t apply to properties with multiple meters, such as multifamily buildings. So, VNEM was introduced as the solution to allow multifamily property owners to earn credits from solar energy surplus and share them across multiple utility meters. Simply put, VNEM allows a third party (the property owner) to accumulate multiple utility customers (the residents) under a single “virtual meter”.

What is Virtual Grid?

When it comes to solar energy solutions, Virtual Grid is more than just your typical billing software. It's a comprehensive package that combines cutting-edge technology with the unwavering support of the Ivy Energy team. With Virtual Grid, the solar experience becomes a win-win for both property owners and residents, delivering a host of valuable features that revolutionize how solar energy is distributed and billed.

For property owners and their management teams, Virtual Grid offers peace of mind, as they no longer need to worry about the fair distribution of onsite solar benefits among residents. The software's intelligent algorithms ensure that solar credits are allocated equitably based on actual energy consumption. This means that each resident receives their rightful share of solar energy and potential savings, fostering a sense of transparency and trust within the community.

But Virtual Grid doesn't stop there. Its proprietary algorithm and utility-grade monitoring take solar billing to a whole new level. Residents can bid farewell to confusing and inaccurate bills. Instead, they are treated to precise, consumer-friendly statements that reflect their actual energy usage. This accuracy not only guarantees the recovery of hard costs for property owners but also opens up new opportunities for increased Net Operating Income (NOI).

How does the Virtual Grid Equitably Share Solar with Residents?

In the case of multifamily properties, distributing the benefits of solar has typically been addressed through linear sub-metering or a flat discount for all residents. While flat discounts are straightforward, both of these methods can still involve significant paperwork and time-consuming management. Additionally, it brings up the issue of equitable distribution when residents use different amounts of electricity and at different utility rates. With Ivy Energy's Virtual Grid software, multifamily property owners have a game-changing solution to streamline the process and overcome these challenges. The Virtual Grid turns an onsite solar investment into a virtual power plant. Here’s how it works:

1. Calculates Avoided Utility Costs from Solar

From step one, the software automates all the necessary calculations, ensuring that each community member receives their fair share of solar energy benefits. Virtual Grid collects individual meter data for granular load monitoring, down to 15-minute increments. This comprehensive approach not only supports equitable distribution but also safeguards against potential issues like excess discounting and overbilling.

By collecting individual meter data, Virtual Grid provides you with a detailed view of energy consumption at the resident level. This level of granularity allows for precise calculation of each resident’s net utility bill, gross utility cost without solar based on current utility rates, and the avoided cost for the community savings ledger.

2. Determines Each Resident’s Share of the Total Available Community Ledger

Using smart grid logic and Ivy’s proprietary algorithms, Virtual Grid efficiently calculates the unique time-of-use and real-time solar availability for each resident's energy consumption. Virtual Grid takes into account the specific time-of-use rates and real-time solar availability, tailoring the savings to each resident's individual usage patterns. This personalized approach is what drives the equitable allocation of live solar, non-live solar, and any potential solar savings.

As a bonus, this means that residents have the opportunity to optimize their savings by shifting their energy usage to align with periods of abundant solar availability. It's a game-changer that empowers residents to actively participate in the renewable energy journey and increase their clean energy benefits.

3. Generates Resident Solar Bills

Finally, Virtual Grid calculates each resident’s solar bill for the month by applying the appropriate percentage of the community savings ledger to the gross utility cost without solar. The software integrates directly with existing rent ledger systems, reducing property management’s workload while still providing data access. Also, residents receive an easy-to-understand solar energy bill, allowing them to track their clean energy usage and savings month after month. With clear and transparent information at their fingertips, residents can see the direct impact of their solar energy consumption on their overall savings. It's an engaging and interactive experience that encourages a sense of ownership and responsibility toward sustainable energy practices.

Virtual Grid is a Game-changer for Virtual Net Metering

As the demand for clean energy solutions continues to grow, shared solar projects offer a promising avenue for the widespread adoption of renewable energy. However, the limitations of traditional sub-metering or flat discounts with virtual net metering don’t support the equitable distribution of renewable energy benefits. By harnessing the power of Ivy’s Virtual Grid, multifamily property owners can fairly distribute solar credits and enhance accessibility to clean energy for a broader range of participants. With Virtual Grid, you can bid farewell to uncertainties and billing discrepancies. The software's robust capabilities, smart grid logic, and proprietary algorithms empower property owners to provide fair and transparent billing for their residents, building trust and fostering a positive solar experience. Simplify your solar energy management with Virtual Grid. Get a free demo today!