A Net Meter is a type of utility meter that measures the net flow of energy into your home. When a solar system is generating less power than is being consumed in the home, the net meter runs forwards. When a solar system is generating more power than is being used in the home, the net meter runs backwards. Net energy is measured over a year period, whereas typical utility plans are based on a monthly billing cycle. NEM essentially utilizes the utility as a storage center for accumulated credits from solar energy production that is not used in the home.