In a progressive move, the Energy Regulation Board (“ERB”) has published the draft Net-Metering Regulations (the “Draft Regulations”), which will allow electricity consumers who generate their own electricity, using renewable energy technologies, to supply any excess electricity back into the grid and receive a credit. The credit will then be offset against any electricity the consumer would otherwise have to purchase when it is not producing enough to meet its needs at a different time during an applicable billing period.
Net-metering creates significant savings on electricity costs, encourages self-generation and reduces reliance on the grid. Self-generation and net-metering also reduce power supply interruptions by making available to the grid any excess power generated, thereby increasing the bankability of electricity projects.
By limiting participation to consumers who generate electricity with renewable technologies (i.e. solar PV, net carbon free fuel cell resources, hydro, geothermal, biomass, biogas, biofuel and wind), net-metering also promotes the use of renewable energy sources. Use of renewable energy sources is encouraged especially in developing countries like Zambia, who tend to suffer the most from the adverse effects of climate change.
Thus, the Draft Regulations will provide the framework for the reciprocal obligations of licensed enterprises that need, or qualify to facilitate, net-metering on the one hand, and the consumers involved in net-metering on the other hand. The Draft Regulations will also facilitate access, on agreed standard terms, to all qualifying consumers wishing to connect to or use the transmission or distribution system for net-metering purposes.
The cost of grid connection for net-metering generation, tariffs compensation and billing will also be regulated in the Draft Regulations. Therefore, the long-awaited cost-of-service study, which, once published is meant to inform the pricing of electricity to various consumers by the state utility company, ZESCO Limited, would be an important factor to consider in relation to the cost of grid connection, tariffs compensation and billing to be contained in the Draft Regulations.
ERB, on behalf on of the Ministry of Energy, is therefore undertaking a consultative process which commenced on 17 August 2022 and has invited electricity supply industry stakeholders and the public to propose amendments and comments to the Draft Regulations by 14 September 2022 at 5 pm.
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Read the original publication at Moira Mukuka Legal Practitioners.