SRECTrade Partners with Dependable Supply Chain Services

Posted June 16th, 2020 by SRECTrade.

SRECTrade is excited to announce a partnership with Dependable Supply Chain Services to power its electric transportation fleet with 100% renewable electricity and manage its portfolio of environmental commodities. A full press release can be found here.

As a partner in the Volvo LIGHTS program, Dependable has adopted a fleet of electric yard tractors, Class-8 electric trucks, electric forklifts and light duty charging stations to demonstrate the logistical and financial feasibility of transportation electrification in the 3PL industry. The electric fleet has been deployed at a variety of Dependable facilities in the Southern California region.

As part of Dependable’s transition to a clean fuel fleet, SRECTrade is leading the Company’s efforts to manage and maintain its portfolio of California Low Carbon Fuel Standard (LCFS) credit generating assets. The LCFS credits are monetized to help facilitate the return on investment in the low carbon vehicles and offset fuel and operational costs associated with the fleet. By pairing Dependable’s electricity consumption with renewable energy, the Company has been able to generate additional quarterly incentive revenue equivalent to approximately $0.25 per kWh.

In addition to electrifying its fleet, Dependable is developing an on-site solar energy facility to power their expanding fleet of EV assets. Investing in on-site renewable generating capacity will further demonstrate grid independence and mitigate energy costs.

We look forward to continuing our relationship with Dependable and providing them the support they need to continue their adoption of clean transportation assets.

SRECTrade’s Commitment To Do Better

Posted June 10th, 2020 by SRECTrade.

We are outraged and heartbroken by the murders of George Floyd, Breonna Taylor, Ahmaud Arbery, Tony McDade, and countless others. These events, associated with deep-rooted racism throughout the United States, are one of many injustices against the Black community that we will not stand for.

Black, Indigenous and People of Color (BIPOC) continue to be disproportionately impacted by climate change. Their communities tend to be overwhelmingly impacted by poor air quality and carbon-intensive energy and transportation resources. As a company committed to doing our part to help clean energy become a reality, we recognize that this means we must be equally committed to addressing racial inequalities.

SRECTrade currently does not reflect the diversity it should. We acknowledge that our company would not be here without the environmental justice movement spurred forward by predominantly BIPOC communities fighting for environmental protection and equity. We are committed to using our platform to drive change and push ourselves to listen and learn more in order to tangibly exemplify our support to the Black Lives Matter movement.

To demonstrate our immediate support, we have donated $5,000 to The Greenlining Institute and $5,000 to the NAACP Legal Defense and Educational Fund, Inc.

To implement internal change, we have formed a diversity, equity, and inclusion (DEI) committee to continue contributing to open dialogue about racism. This committee will also help us address our human resources, vendor, and engagement practices. We are also reevaluating our recruiting and retention practices to promote hiring of diverse talent and ensuring our culture is inclusive and equitable.

Lastly, our DEI committee is evaluating long term projects to engage our employees to continually show our support to the Black Lives Matter movement.

This statement is a promise that as a company we will put in the hard work and time to hold ourselves more accountable in order to meaningfully contribute to and fight for racial justice.

We stand in solidarity with the Black community.

Washington, D.C. SREC Market Update

Posted May 22nd, 2020 by SRECTrade.

Despite market disruptions associated with COVID-19, the SREC market in Washington D.C. has remained strong over the first quarter of 2020, with consistent pricing and liquidity. Our enclosed analysis shows the fundamentals behind this dynamic, with a decreasing oversupply in 2020 & 2021, followed by undersupply into the foreseeable future.

As per the DC PSC RPS Report for Compliance Year 2019, load falls into one of three compliance buckets:

  1. Load contracted prior to October 8, 2016, which is obligated to the provisions in the DG Amendment Act of 2011.
  2. Load contracted between October 8, 2016 and January 1, 2019, which is obligated to the provisions in the Renewable Portfolio Expansion Act of 2016.
  3. Load contracted on or after January 1, 2019, which is obligated to the provisions in the CleanEnergy DC Omnibus Bill Amendment Act of 2018

Based on the DC Compliance Reports, in compliance year 2020, 18.7% of the total retail sales is exempt from the RPS Expansion Act of 2016. This load will be subject to ACP levels which are lower than current DC SREC pricing. In this analysis, compliance associated with load in this bucket will pay the compliance penalty instead of purchasing DC SRECs. The analysis also assumes that load contracts exempt from the CleanEnergy DC Omnibus Bill, will roll off in two-year equal increments after compliance year 2021.

Should you have any questions regarding the enclosed analysis or need transaction and management services, please contact us.

CA LCFS Market Update – May 2020

Posted May 8th, 2020 by SRECTrade.

The first quarter of 2020 showcased both record high pricing and a COVID-19 slump in the California Low Carbon Fuel Standard (CA LCFS) market. Credit pricing remained strong throughout January and February 2020, with spot pricing sustaining levels over ~$200 per credit and some transactions executed above the previously implied ~$213 cap. In mid-March, LCFS credit pricing dropped nearly 20% from ~$210 to approximately $170 per credit due to the impact of COVID-19. The enclosed update provides highlights on news impacting the market, a recent price trend overview, and a closer look at the Q4 2019 credit and deficit report released by CARB at the end of April.

SRECTrade offers LCFS credit management and brokerage services to electric vehicle (EV) fleet operators, OEMs, EV charging station owners, and other clean fuel asset owners. We help our clients navigate the entire LCFS process including asset registration, ongoing reporting requirements, transacting, settlement, and remittance of funds. Our domain expertise in environmental commodity markets allows us to provide our clients with industry leading regulatory and market knowledge. Please reach out to cleanfuels@srectrade.com for more information.

New Jersey SREC Program Expected To Close In Late April

Posted April 2nd, 2020 by SRECTrade.

April 6, 2020 EDIT: The BPU ordered the following earlier today:

  • The registration portal for new projects to the SREC Registration Program will be closed on April 30, 2020.
  • Only previously approved Subsection (t.) projects dated prior to October 29, 2019 will be exempt from the market closure on April 30th.
  • Projects must have a PTO granted from an electric distribution company by April 30, 2020 to qualify for inclusion in the legacy SREC program. The post-construction (as built) certification package will be due 90 days after the PTO date (not 90 days after April 30th).
  • The registration portal will be closed on the 91st day after April 30th (July 30th).
  • All extensions granted by Board staff (either 1st or 2nd extensions) will expire on April 30th. Post-construction (as built) certification package due 90 days after April 30th.

On Tuesday, March 31st, the New Jersey Board of Public Utilities (BPU) announced that it forecasts that 5.1% of state electricity sales will be supplied by operational solar projects around or before May 2020. It is therefore expected that the current SREC program (“Legacy Program”) could close to new applications as soon as April 30th.

In order to qualify for the current SREC Program, solar projects 1) need to obtain a Permission to Operate (PTO) by the SREC program closure date (estimated April 30th) and 2) submit their final-as-built application within 90 days from receiving PTO.

Solar systems that receive PTO after the SREC market closure date will be eligible for the new Transition Incentive program (“TREC Program”). Many details regarding the 15-year, fixed-price TREC Program structure have been finalized, including a flat pricing schedule of $152.00 per SREC. However, many important details surrounding the implementation and administration of the TREC Program Administrator have not been finalized yet. As a result, it is expected that TREC approvals and payments will not be made for several months after the program opens.

SRECTrade will continue to monitor the Legacy Program’s closure and the development of both the TREC Program and the eventual Successor Incentive program.

The Effects of COVID-19 on SREC Markets

Posted March 30th, 2020 by SRECTrade.

With the COVID-19 pandemic impacting financial markets across the globe, we wanted to provide an update on the SREC markets and how this crisis could affect pricing and liquidity in the near-to-medium term.

On the supply side of the market, production of SRECs from existing systems should remain largely unaffected, since solar assets will continue to generate electricity at their typical rates. However, depending on the extent of the economic damage caused by COVID-19, build rates of new solar assets may see a decline during the current period. While the extent of this impact cannot be determined with certainty, it is likely that the market will see a slowdown of new solar asset build during this economic downturn, which will slightly decrease overall SREC production.

A larger question mark lies on the demand side of the equation, where the severity of the crisis’ impact on electricity load remains unknown. While residential electricity usage will likely increase as a result of more people working from home and spending time indoors, the commercial and industrial sectors will see a drop-off in electricity demand. In the PJM and Massachusetts markets, commercial and industrial electricity demand makes up approximately 62% of total load demand, significantly outweighing residential load demand. Depending on how long the economy remains shut down, we will likely see overall electricity load falter in the back-end of Q1 and at least the first half of Q2.

In states where the SREC market may be closer to relative equilibrium, in the prompt period, and sensitive to shifts in market fundamentals (i.e. solar build and electric load), such as New Jersey, Maryland, and Massachusetts, we may experience a near-to-medium term decrease in pricing. However, for those states, such as Washington D.C., where the market is currently under-supplied, the drop in load will likely be insufficient to shift the underlying balance in the market.

Another near term impact of this crisis may be a lack of liquidity. Natural buyers of SRECs may take a less active approach and wait until this crisis unfolds further to determine their demand for SRECs for the current compliance year. This would mean less liquidity in the markets and could result in fewer credit transactions.

It is important to understand that while a temporary drop in SREC demand is possible, if the crisis resolves in the next couple of months and economic activity goes back to normal, the effect on the SREC markets will be temporary and short lived.

With so much uncertainty surrounding the fallout from this virus on the economy, it is hard to determine the exact impacts this will have on the SREC markets in the medium-to-long term. In the short term, we may expect lower pricing and less liquidity, which will likely persist until the United States starts to round the corner with the COVID-19 virus. SRECTrade will keep its clients, partners, and constituents updated as we push through this unprecedented time.

SRECTrade current status: A message from our CEO

Posted March 18th, 2020 by SRECTrade.

Dear Valued Clients and Partners,

As concerns about the novel coronavirus (COVID-19) continue to rise, the health, safety, and well-being of our employees and clients remains paramount. In difficult times like these we need to prioritize supporting one another to weather the storm and ensure a successful return to our normal standards of well-being.

Our San Francisco, CA and Somerville, MA offices are closed, and we have transitioned all employees to work from home. Currently, our staff is healthy and safe. We are still operating normal business hours and providing the same high level of service that you have grown accustomed to. As of now, you should notice very little change in communication and response times.

Moving forward, we are encouraging all employees and clients to follow the guidance and recommendations of local, state, and federal officials. Together we can help speed up the return to normalcy.

Thank you for choosing SRECTrade to help enable your clean energy use and reduce carbon emissions. We will continue to do everything we can to support your clean energy investments and improve our environment.

Please do not hesitate to let the SRECTrade team know how we can help you in the coming weeks.

All the best,
Steven & the SRECTrade team

Steven Eisenberg
Chief Executive Officer
SRECTrade, Inc.

Low Carbon Fuel Standard (LCFS) Program Overview Video

Posted March 5th, 2020 by SRECTrade.

At SRECTrade, we strive to make the Low Carbon Fuel Standard credit market straightforward and easy to understand. We focus on accelerating the adoption of clean fuels by providing services and technology that minimizes the time, cost, and risk associated with achieving the benefits from LCFS credits.

We are happy to announce that we have released an educational video on the Low Carbon Fuel Standard (LCFS) Market and how fleet operators can take advantage of its benefits.

To view the video, please click the image below.

CA LCFS Update – February 2020

Posted February 14th, 2020 by SRECTrade.

2020 is proving to be another record-breaking year in the California Low Carbon Fuel Standard (CA LCFS) market. Credit pricing remained strong throughout Q4 2019 and January 2020 with spot pricing sustaining levels over ~$200 per credit. Despite the cost containment provisions the California Air Resources Board (CARB) implemented in late 2019, the market recently has transacted above the implied ~$213 cap. The enclosed update provides highlights on news impacting the market, a recent price trend overview, and a closer look at the Q3 2019 credit and deficit report released by CARB at the end of January.

SRECTrade offers LCFS credit management and brokerage services to electric vehicle (EV) fleet operators, OEMs, EV charging station owners, and other clean fuel asset owners. We help our clients navigate the entire LCFS process including asset registration, ongoing reporting requirements, transacting, settlement, and remittance of funds. Our domain expertise in environmental commodity markets allows us to provide our clients with industry leading regulatory and market knowledge. Please reach out to cleanfuels@srectrade.com for more information.

Pennsylvania SREC Market Update: What Will the Market Look Like If SB600 Passes?

Posted February 5th, 2020 by SRECTrade.

In November of 2018, the Pennsylvania Department of Environmental Protection (“DEP”) released the Pennsylvania Solar Future Plan. The 152-page document outlines strategies to help the state meet a goal of 10 percent in-state solar electricity generation by 2030. As part of this plan, the DEP recommends that the state consider revising their Alternative Energy Portfolio Standard Program (“AEPS”) and increase the target to help bolster SREC prices and solar build rates. In response, on April 10, 2019, Senate Bill 600 was introduced in the Pennsylvania General Assembly. Most notably, the Bill:

  1. Expands AEPS Tier I requirement from 8% by 2021 to 30% by 2030
  2. Expands AEPS solar carve-out from 0.5% by 2021 to 10% by 2030, including 7.5% for grid-supply solar and 2.5% for distributed generation (DG) solar
  3. Introduces fixed alternative compliance payment (ACP) schedules and a 15-year SREC eligibility term for solar facilities (beginning on June 1, 2021)

While the future of this Bill is still uncertain, SRECTrade has prepared an analysis that illustrates the projected market dynamic if SB600 were to pass as well as baseline scenario cases assuming the current AEPS policy stays in place.

In reaction to these bullish signals from policymakers and the closure of PA borders to out-of-state systems, SREC prices have seen an appreciation in value over the past 12 to 18 months to values around $35-45. SRECTrade will continue to monitor progressions with this Bill and update our clients, partners, and stakeholders accordingly.