Understanding Solar Net Metering in Zambia
What Exactly Is Solar Net-Metering?
Net-metering is a billing system designed to reward homeowners, as well as commercial and industrial entities (known as prosumers), for generating renewable energy that can be exported. This energy is not consumed at these premises, but exported to a licensed distribution company (a distribution enterprise). On August 1st, the Electricity (Net-Metering) Regulations (SI 38 of 2024) came into effect, implementing net-metering generation in Zambia following Cabinet approval on June 10th, 2024.
The Regulations define a prosumer as a consumer who participates in Net-Metering, after entering into a “Net-Metering Connection Agreement” and a “Net-Metering Supply Agreement” with a licensed electricity distribution company.
Licensed electricity distribution companies in Zambia include, but are not limited to: ZESCO Ltd, Copperbelt Energy Corporation (CEC), North West Energy Corporation and ZCCZ on the Copperbelt province.
How Does Net-Metering Work With Solar Power?
Solar net-metering works by allowing prosumers to send any excess electricity produced by their solar PV systems to the grid, while also being able to buy electricity from the grid.
Therefore, a prosumer gets commercial benefit by exporting excess electricity they are generating while at the same time having access to the grid to ensure the prosumer’s premises aren’t left without power when their solar PV system isn’t generating enough.
The commercial benefit is in the form of receiving credits for any excess electricity the prosumer exports to the grid. These credits will then be deducted from the prosumer’s power bill, leading to savings for the prosumer. Net-metering also benefits the utility grid, as the energy that is exported to the grid helps stabilise the power supply system in that location.
The amount of solar electricity the prosumer exports to the grid will need to be measured so that the prosumer can get paid for it. The prosumer will either get a new meter – known as a ‘net meter’ – or receive reconfigurations to their existing electricity meter.
The net meter has two counters:
- Counter 1: Imports
This shows how much electricity the prosumer imports from the grid. The prosumer imports from the grid when their home/premises is using more than their solar PV system can generate at any moment in time. The prosumer pays the retail electricity tariff rate for every kWh of electricity imported. This tariff rate can vary from 44 ngwee to 244 ngwee/kWh, depending on the prosumer’s tariff category (the average tariff is approximately 184 ngwee/kWh). The ERB approved an emergency tariff for ZESCO from January 2025 to July 2025. The emergency tariff rate varies from 35 ngwee to 639 ngwee/kWh.
- Counter 2: Exports
This shows how much solar electricity the prosumer exports to the grid. The prosumer exports to the grid when their solar PV system is generating more solar energy than their home/premises can use at any given moment in time. The prosumer gets paid a feed-in tariff for every kWh of electricity they export. The reference tariff is determined by the Energy Regulation as described in schedule 2 of the Net-Metering Regulation and is generally lower than the retail tariff that the prosumer will pay for imports from the grid. (Currently, the determined reference tariff is 167 ngwee/kWh)
The net meter houses the import and export counters that make net metering possible. Because of this, it is also called the bi-directional meter. And if it is able to send this data remotely, it’s also called a smart meter.
Technical Aspects of Net-Metering
Grid-connected Solar PV involves the connection to the electricity supply network owned by a licensed distribution company, which is governed by strict technical requirements to ensure safety and to ensure stability of the network and quality of service provided to consumers.
The Zambia Distribution Code prescribes these technical requirements.
The key components of the solar PV system – which are either installed on the rooftop of the premises or at a remote site – comprise of the solar array (PV modules/panels) that capture sunlight and generate electricity, and an inverter for grid connection. The inverters for grid connection are specifically designed to be connected to the grid and have to comply with strict technical standards to ensure safety to personnel and quality of supply. For example, during a power blackout from the grid, the inverter is designed to automatically switch off.
The inverters for grid connection convert the DC output from a PV array to provide a synchronised AC current for injection into the low-voltage grid network of the licensed distribution company. An inverter designed for grid-connected operation generally can not be used for a stand-alone system.
In a stand-alone system, batteries are used for storage of the generated electricity, but for grid-connected Solar PV systems, the grid provides the storage medium. The most expensive component in a stand-alone system is the battery. This cost (battery storage) is avoided in a grid-connected Solar PV system.
Inverters for grid-connected PV are commercially available from different manufacturers and in a range of sizes. Route 3 Solar Systems experts are on hand to advise you in selecting an inverter perfectly suited to your solar PV array.
The Net Metering Regulations prescribe that a licensed distribution company will only offer a net metering service to a consumer of a size equal to 10% of its historic maximum demand and under certain conditions up to 15kW and 26kW for single- and three-phase systems respectively.
Is It Possible To Get A Net Zero Energy Bill With Net-Metering?
Well, technically yes. It is certainly possible for this concept to eliminate a prosumer’s electricity power bills. However, restrictions in the Net Metering Regulations make it unachievable.
The regulation prescribes capacity limits that can be contracted under net-metering, which is 10% of your historic maximum demand and not exceeding 15kW and 26kW for single- and three-phase systems respectively.
Typically, a household contracted capacity is 15kW. Therefore, assuming that the historic maximum demand is the contracted capacity, the capacity that the licensed distribution company is obliged to enter into a net metering supply agreement with the prosumer is 1.5kW and under certain agreed conditions up to a maximum of 15kW. The allowed size of the solar PV system is therefore not able to meet the prosumer’s own electricity needs and will be compelled to import from the grid to cover the deficit.
Further, the cost of importing power from the grid is significantly higher than the tariff for the credits the Prosumer will get for exporting solar electricity.
For reference, the retail tariff rates are, on average, currently approximately 184 ngwee/kWh of grid electricity that a prosumer imports. The feed-in tariffs (reference tariffs) determined by the ERB is approximately 167 ngwee/kWh.
This means that to get a net-zero energy bill with net-metering, the prosumer would have to invest in a solar PV system that is significantly larger than what is currently permitted by the Regulations.
Benefits Of Net-Metering
When the prosumer receives their first post-solar PV net-metering electricity bill, the amount they pay will be the difference between the cost of the grid imports and the earnings for the solar exports into the grid.
Prosumer’s bill = Usage – Exports
However, the licensed electricity distribution company doesn’t know what goes on ‘behind the meter’. None of the solar energy that has been self-consumed, saving 184 ngwee per kWh, is shown on the prosumer’s bill. Therefore, for the prosumer, that’s where the bulk of the savings reside!
To illustrate these savings, take a prosumer with an annual historic maximum consumption of 12,000kWh and a net-metering agreed exporting capacity of 1,200kWh to the grid. The solar PV system that will be installed will have to produce an annual yield of 13,200kWh (typically 8kWp system).
What the bill will indicate with regards to the prosumer’s savings made in the year is therefore:
Solar exports: 1,200kWh x K1.67 = K2,004
But the true savings are:
Solar exports: 1,200kWh x K1.67 = K2,004
Maximum daylight solar self-consumption: 12,000kWh x K1.84 = K22,080
Annual solar savings possible = K24,084
As you can see, accounting for self-consumption is important to evaluate the true savings (value) of solar PV net-metering generation. And for a prosumer who has invested in a 8kWp solar net-metering generation system, costing approximately K80,000, they can recover the cost of investment with a simple payback period of only 3 years.
Conclusion
The time to invest in a rooftop solar PV system is now. Zambia is blessed with abundant solar energy resources. And with the country going through prolonged load-shedding hours, and the prices of solar components at their record lowest, there’s truly no better time to invest in a solar photovoltaic (PV) system.
The law now allows owners of solar PV systems to get rewarded for sending solar power to the grid. This results in a lower energy bill as well as a more stable power grid.
So even if it’s currently impractical to aim for a zero on your electricity bill, net-metering does indeed help you keep more of your money. The value to the consumers is that the cost of investment for such systems is recoverable in a relatively short period of time.
Route3 Solar Systems Limited has a competent team to design a solar PV net-metering generation system for you. We can guide you through the selection of components for your system and complete the application process with the relevant licensed distributions companies. We also have a network of pre-vetted installers on the ready. So if you need help in participating in the net-metering programme, get in touch with us and we shall make your journey a lot smoother!