Posts Tagged ‘SREC Markets’

SRECTrade Markets Report: February 2014

Posted March 27th, 2014 by SRECTrade.

The following post is a monthly update outlining the megawatts of solar capacity certified to create SRECs in the Solar REC markets that SRECTrade serves. All PJM data is based on the information available in PJM GATS as of the date noted. All MA data is based on the information provided by the DOER as of the date noted. This analysis does not include projects that are not yet registered and certified with the entities noted herein.

A PDF copy of this table can be found here.

 Capacity_February2014

Overview of PJM Eligible Systems

As of March 14, 2014 there were 41,810 solar PV and 824 solar thermal systems registered and eligible to create SRECs in the PJM Generation Attribute Tracking System (GATS). Of these, 276 (up 3 projects since December and representing 0.65% of the total number of projects installed) have a nameplate capacity of 1 megawatt or greater and account for 43.5% of the overall capacity registered. Thirty (30) of these projects have a nameplate capacity of 5 MW or greater (an increase of 1 since our last update). New Jersey continues to host most of the larger scale facilities, claiming home to 19 of the 30 facilities, that are equal to or greater than 5 MW. The three largest projects are a 29.1 MW project in MD, followed by a 25.1 MW in NJ and a 20.0 MW project sited in Illinois and registered in the PA market. The 20 MW Illinois project first appeared in this analysis this month.

NJ Office of Clean Energy Estimated Installed Capacity Through 2/28/14

On March 11, 2014, the New Jersey Office of Clean Energy (OCE) announced total installed solar capacity reached 1,245.5 MW; an increase of approximately 44.1 MW over the total capacity reported at the end of January. The average last six month build rate per month, according to the OCE data, is 18.5 MW. Note that this data does not directly tie to GATS registration data because of a lag between NJ Office of Clean Energy certifications and GATS registrations. For more information on the state of the NJ market see our latest webinar.

Overview of MA DOER Eligible Systems

As of March 26, 2014, there were 10,519 MA DOER qualified solar projects; 10,346 operational and 173 not operational. Total qualified capacity is 675.8 MW; 423.2 MW of which is operational (up 8.2 MW from the DOER’s February 2014 report) and 252.6 MW of qualified capacity is not yet operational under the current SREC-I program.

*Note: not operational, qualified projects over 100 kW in size were required to demonstrate that at least 50% of the project’s costs be incurred by 12/31/2013 in order to remain qualified. The latest DOER Solar Carve Out report suggests that at least 22.3 MW of capacity was removed from eligibility for failing to meet the requirements of this deadline. Projects less than 100 kW must be interconnected by the effective date of the SREC-II program or June 30, 2014, whichever is earlier. Whereas projects greater 100 kW in capacity must have submitted application paperwork and met certain requirements by July 5, 2013. For more information refer to our blog posts covering the current SREC program.

How to Interpret This Table

The tables above demonstrate the capacity breakout by state. Note, that for all PJM GATS registered projects, each state includes all projects certified to sell into that state. State RPS programs that allow for systems sited in other states to participate have been broken up by systems sited in-state and out-of-state. Additional detail has been provided to demonstrate the total capacity of systems only certified for one specific state market versus being certified for multiple state markets. For example, PA includes projects only certified to sell into the PA SREC market, broken out by in-state and out-of-state systems, as well as projects that are also certified to sell into PA and Other State markets broken out by in state and out of state systems (i.e. OH, DC, MD, DE, NJ). PA Out-of-State includes systems sited in states with their own state SREC market (i.e. DE) as well as systems sited in states that have no SREC market (i.e. VA). Also, it is important to note that the Current Capacity represents the total megawatts eligible to produce and sell SRECs as of the noted date, while the Estimated Required Capacity – Current and Next Reporting Year represents the estimated number of MW that need to be online on average throughout the reporting period to meet the RPS requirement within each state with only that particular compliance period vintage. For example, New Jersey needed approximately 496.7 MW online for the entire 2013 reporting year to meet the RPS requirement with 2013 vintage SRECs only. SRECs still available from prior eligible periods can also impact the Solar RPS requirements. Additionally, the data presented above does not include projects that are in the pipeline or currently going through the registration process in each state program. This data represents specifically the projects that have been approved for the corresponding state SREC markets as of the dates noted.

Note: SREC requirements for markets without fixed SREC targets have been forecast based on EIA Report “Retail Sales of Electricity by State by Provider” updated 10/1/12. Projected SRECs required utilizes the most recent EIA electricity data applying an average 1.5% growth rate per forecast year. The state’s RPS Solar requirement is then multiplied by forecast total electricity sales to arrive at projected SRECs required. Projected capacity required is based on a factor of 1,200 MWh in PJM states and 1,130 MWh in MA, generated per MW of installed capacity per year.

Why Doesn’t Illinois have an SREC Market?

Posted August 25th, 2011 by SRECTrade.

The Illinois Renewable Portfolio Standard (RPS) has aggressive renewable energy goals. The RPS requires Investor-Owned Electric Utilities (EUs) and alternative retail electric suppliers (ARES) to have 25% of their electricity come from renewable resources by 2025, so why don’t we see a viable SREC market? Part of the story can be tied to anemic SREC incentives.

Within the 25% renewable requirement, 6% of the renewable energy procured from EUs and ARES must come from solar sources, with percentages starting lower, reaching 6% by 2016, and holding until 2025. This latest addition came into effect under HB 6202, the details of which can be seen here. The legislation goes into effect in June 2013, with incremental requirements leading up to 6% in June 2016. In order to meet this requirement, EUs and ARES are able to purchase Solar Renewable Energy Credits (SRECs) from private individuals and businesses throughout the mid-West and mid-Atlantic regions- not just from within Illinois.

A unique aspect of the Illinois RPS revolves around a forced alternative compliance payment (ACP), which states that ARES must meet 50% of their renewable quota by paying an ACP. This effectively divides the potential REC market in half as tradable RECs will only be utilized for 50% of the renewable quota. EUs and ARES can buy RECs from the PJM-GATS or M-RETS (Midwest Renewable Energy Tracking System) tracking registries, or just pay the ACP fine.

It’s unlikely that the Illinois market will be attractive for the following two reasons:

1) The ACP currently covers all renewable fuel types. Current ACP rates for June 1, 2011 through May 31, 2012 are estimated to be approximately $0.058 per MWh, with a maximum value of $2.158/MWh. ACP rates vary by utility territory and more information can be found here. There isn’t a separate “carve-out” for solar with a higher ACP rate. This means that REC values are much lower than necessary to incentivize the solar market with RECs alone. For comparison New Jersey’s RY2012 Solar ACP (SACP) is $658 per SREC.

2) Utility companies may opt to meet their full solar requirement by paying the relatively low ACP fine for not complying, rather than meeting the other “optional” 50 % requirement by paying for SRECs.

Other options for Illinois sited solar systems:

Illinois systems are eligible to sell SRECs in Pennsylvania if their facility is located in an area served by Commonwealth Edison (ComEd) utility. Currently, selling their SRECs into the PA market provides the highest value for SRECs coming from IL (ComEd) facilities, with pricing in August 2011 at $25 per SREC. Solar systems that are located in all of Illinois were previously able to sell SRECs into the D.C. market, but recent legislation has made that option no longer possible.

Other incentives have been put in place to help catalyze the Illinois solar market, though several lack the necessary funding to allow for widespread solar adoption. The Illinois Solar Energy Association runs an annual Renewable Energy Credit Aggregation Program (RECAP) that allows qualified systems to sell SRECs to the ISEA at a fixed rate of $200/SREC. Unfortunately, this program has exhausted its funding and is only accepting wait list applications.  The state of Illinois also offers a special property tax assessment for properties with solar systems. Finally, the state Solar and Wind Rebate program offered a 30% rebate to residential and commercial systems and a 50% rebate for non-profit or commercial systems before closing its latest round of funding in December 2010.

What Happened to the North Carolina SREC Market?

Posted June 23rd, 2011 by SRECTrade.

Since its inception last summer, the North Carolina SREC market has not materialized into the type of market seen in other states like New Jersey, Maryland and Massachusetts. There are several factors lending to the stagnation of this market, many of which were covered in our blog post “Where is the NC SREC Market?” published last August. Since then, the nascent NC market has continued to dwindle. Most small solar facilities in North Carolina have been selling their SRECs into the DC market, an opportunity that will be closing as new legislation in DC shuts the market to out-of-state facilities.

A few factors  impair the viability of the North Carolina market:

1) The absence of both an SACP and transparent market prices make it difficult for projects to find viable SREC-based financing.

2) There is a shortage of buyers. The two main buyers, Duke Energy and Progress Energy, which serve 65% of NC utility customers and provide 71% of the state’s electricity, have both met their NC REPS compliance needs for solar, with Progress locking out SRECs until 2014 and Duke having ample supply through 2018, the final year of RPS compliance.

3) North Carolina accepts 25% of its SRECs from out of state sited facilities.

In an effort to curb these seemingly premature accomplishments by utilities, legislators in North Carolina introduced two important clean energy bills in the last few months: the Solar Jobs Bill (HB495/SB473) and the Energy Independence and Job Creation Bill (SB694). The former aspired to increase the solar requirement for utilities from .2% to .4% of retail electric sales by 2018 in an effort to further develop the state’s solar industry, while also requiring that no more than 12.5% of the RECs applied towards the RPS requirements come from out-of-state generators. If this bill were to pass, it would help catalyze an NC SREC market as utilities would need to find additional sources of SRECs to meet new compliance targets. To create more flexibility, the Energy Independence and Job Creation Bill allowed for “third party sales” of renewable energy, or the ability for facilities with third-party owned renewable systems to buy electricity directly from the third-party without classifying them as utilities, so long as their capacity is under 2 MW. This bill would open the North Carolina market up to third-party financing companies like SunRun, SolarCity and Sungevity, which would foster the development of solar leasing and PPAs.

Unfortunately, neither of these bills were taken up by legislators by the crossover deadline on June 9th, effectively rendering them dead until the start of the 2013 session. For now, the future remains unclear for a more active SREC market in North Carolina.

Additional Resources:

Relevant Utility Rebates

NC Sustainable Energy Association – legislative news

NC GreenPower – non-profit created by the NC Utilities Commission

Brad Bowery to speak at ASES National Solar Conference

Posted April 1st, 2010 by SRECTrade.

SRECTrade CEO Brad Bowery will be speaking at the 39th ASES National Solar Conference May 17-22 in Phoenix, AZ. The National Solar Conference hosted by the American Solar Energy Society (ASES) is America’s longest-running and leading conference on the emerging trends, technology, and opportunities shaping the new energy economy. Featured keynote speakers include Earth Day Founder Denis Hayes, Executive Director of the Bullitt Foundation, Amory Lovins of the Rocky Mountain Institute and Catherine Zoi of the U.S. Department of Energy.

ASES

Wednesday, May 19
4:00 to 5:30pm
Solar Renewable Energy Certificate Markets: Status and Emerging Issues
Moderated by: Lori Bird, NREL
This session will explore the status of solar renewable energy certificate (SREC) markets in the U.S. and emerging issues. It will cover the status of both compliance markets for SRECs that have emerged as a result of solar set asides in state renewable energy standards as well as voluntary markets for SRECs. This session will cover issues such as the integration of a potential federal solar REC market into existing markets, best practices in tracking and verifying SRECs for RPS compliance, as well as SREC trading and aggregation.
Presentations Include:
Industry Perspective on U.S. SREC Markets
Fred Zalcman, SunEdison
NJ SREC Program Status
Mike Winka, NJ BPU
Status of Solar Energy Set Asides in State RPS Programs
Charlie Kubert, Clean Energy Group
Verification and Tracking of RECs: Issues and Challenges
Steve Wiese, Clean Energy Associates
Trading in the SREC Markets
Brad Bowery, SRECTrade

As CEO of InClime, LLC, Brad Bowery has taken SRECTrade from a website and a concept to one of the most influential businesses in the growing SREC market. He successfully established the online auction in New Jersey, Pennsylvania, Maryland, Delaware and DC, and has laid the groundwork for implementations in Ohio, Massachusetts and North Carolina. Brad also developed and implemented SRECTrade’s installer program, establishing relationships with installers and project developers throughout the region and creating the foundation for the firm’s growth. In his role, he is in regular contact with stakeholders in the various state SREC programs, is heavily involved in the day-to-day developments of the market, and oversees one of the most comprehensive blogs on the SREC markets

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in Phoenix, AZ