The Public Utility Authority plenary committee officially approved on Wednesday the “net meter” system for 2013, which will allow private homes in Israel to produce and use their own renewable energy, rather than feeding that electricity into the national grid.

The new system, according to the PUA, is suited for both domestic consumers with low power consumption as well as larger consumers, and will dismiss the bureaucratic process of today that currently impedes the growth of at-home solar installations.

With this decision, Israel will join the US and many European nations in allowing its citizens to privately produce and make use of their own renewable energy, the PUA said. While the authority had granted initial approvals to the project in October, the program has now received complete authorization and will be underway in the new year.

Using their net meters, the consumers will be able to deduct the amount of electricity they produce for self-consumption, balancing out the surplus they generate against the overdraft of their consumption from the grid. By constantly having access to information such as load on the national network, the customers will be able to use the net meter to decide when to produce electricity independently for their own homes, and when to abstain.

Overall, this very large project will amount to a consumption system of over 400 megawatts, the PUA said. The country is now able to go ahead with the system in large part due to the significant drop in construction costs for solar power generation equipment, allowing for a renewable energy sector that relies much less heavily on government subsidies, the authority added.

Meanwhile, the PUA said it has been able to minimize the regulatory process required to install such a system, which operates quite simply and does not require residents to acquire a production license.

“This is the first step in realizing the government’s decision toward the future promotion of renewable energy in the State of Israel,” a PUA statement said.

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