Generation of Excess Energy: Homeowners or businesses with renewable energy systems, particularly solar panels, often generate more electricity than they consume during certain periods, such as sunny days.

Feeding Excess Electricity into the Grid: The surplus electricity is fed back into the grid. This is typically done automatically, and the bidirectional meter records the amount of electricity sent to the grid.

Credit Accumulation: For every unit of excess electricity generated and supplied to the grid, consumers receive credits on their electricity bill. These credits can be utilized during periods when the renewable energy system is not generating enough electricity to meet the consumer's demand.

Reduced Electricity Bills: Consumers benefit from reduced electricity bills, as they are only billed for their "net" electricity consumption. Net consumption is the difference between the electricity consumed from the grid and the excess electricity generated and supplied to the grid.