Archive for January, 2012

MA2011 SREC Auction Closes at $540/SREC

Posted January 18th, 2012 by SRECTrade.

The Q3 2011 (July – September 2011) MA SRECs were issued on January 15, 2012. Unlike other SREC markets, the MA Solar Carve-Out program mints SRECs quarterly, three and a half months after the close of the calendar quarter. In coordination with the Q3 2011 issuance, SRECTrade recently held a separate auction for MA2011 SRECs.

The auction closed on Tuesday, January 17th at 5:00 p.m. Eastern. SRECs transacted at a clearing price of $540.00 per SREC. The clearing price, more than 98% of the 2011 Solar Alternative Compliance Payment (SACP), represents a strong demand for MA2011 SRECs due to a shortfall of supply in the market.

MA Chart

The next SRECTrade auction closes on Tuesday, January 31, 2012. This auction will cover all of the SREC markets including DC, DE, MA, MD, NJ, OH, and PA. The order window is currently open. All buyers and self-serve sellers can login here to place an order. Sellers utilizing SRECTrade’s management service, EasyREC, will have orders automatically placed on their behalf. If these sellers need to make changes to their minimum offer prices, they must do so prior to the order window close on January 31 at 5:00 p.m. Eastern.

The next issuance of MA2011 SRECs will be on April 15, 2012, and will cover the Q4 2011 (October – December) generation period.

How Oversupplied is the New Jersey market?

Posted January 18th, 2012 by SRECTrade.

Here is a very basic New Jersey SREC graphic: As of the most recent NJ BPU report, solar installation capacity in New Jersey surpassed 530 MW as of November 30, 2011, the midway point of the 2012 energy year. That’s 44% higher than where it needs to be to meet the 2012 requirement, assuming constant growth. It also means that, with no growth, there is already enough capacity to meet the requirements in EY2013. There is still room for growth in EY2014 and EY2015. Those markets are 17% and 34% short respectively based on installations TODAY. However, the chart below does not account for excess supply that is carried forward, which indicates that the oversupply scenario in New Jersey will likely extend through 2014 and possibly into 2015.

The current supply in NJ is enough to satisfy annual requirements through 2013

The current supply in NJ is enough to satisfy annual requirements through 2013

Note: Energy years run June 1 to May 31. So EY2013 will begin on June 1, 2012 and end May 31, 2013.

Update on US-China Trade Dispute

Posted January 17th, 2012 by SRECTrade.

We’ve received a lot of questions over the last couple of months about the on-going trade dispute with China over the price of Chinese-made crystalline solar modules. Crystalline modules are by far the most commonly installed module type in the United States. Currently the trade dispute doesn’t include thin-film or other solar equipment. Given the central importance of equipment affordability to the solar industry we figure it’s high time to put a quick blog post together summarizing the trade dispute so far.

On October 19th, 2011, SolarWorld and unnamed companies under the newly formed Coalition for American Solar Manufacturers (CASM) file a lawsuit with the Department of Commerce (DOC) and the International Trade Commission (ITC) asking for 100% import duties on crystalline modules imported from China. Two types of investigations are on-going by the DOC/ITC. The first type is a countervailing duties (CVD) investigation. If the DOC/ITC find merit to the SolarWorld lawsuit then the US can impose counter-tariffs to offset the unfairly priced Chinese modules. The second is an anti-dumping (AD) investigation. In a “dumping” investigation the DOC/ITC investigate whether low-priced Chinese modules have caused “injury” to the US economy. If the investigations find “injury” then strong fines could be imposed on China for any crystalline solar modules that they export in addition to countervailing duties. If both CVD and AD fines are imposed module prices exported from China would increase dramatically, forcing Chinese manufacturers to find alternative channels to distribute their products. Many China-based modules manufacturers have preemptively begun to invest in production facilities in Taiwan and other southeast Asian countries not subject to the threat of US import tariffs.

Below timeline acquired from GTM’s Solar Power Year in Review 2011 article.

October 19th, 2011- SolarWorld and unnamed companies under the newly formed Coalition of American Solar Manufacturers (CASM) file an AD and CVD claim with the DOC and the ITC, setting in motion a timeline for the DOC and ITC to form separate investigations.

November 8th, 2011DOC initiated investigation

December 5th, 2011 ITC made preliminary determination of injury, confirming that they will continue investigation

March 27th, 2012- DOC to make determination in its AD and CVD investigation

May 11th, 2012- ITC to make initial determination on CVD investigation

May 18th, 2012- ITC issues orders on its CVD investigation

June 11th, 2012- DOC final determination on its AD investigation

July 25th, 2012- ITC final determination on its AD investigation

August 1st, 2012- DOC final determination on AD investigation

The DOC/ITC schedule is staggered so that the DOC can follow the ITC’s lead on its determinations on the anti-dumping allegations, but the DOC will make a determination before the ITC on the CVD investigation. In candid discussions with some industry experts we’ve been led to believe that some CVD determination will be made by the Department of Commerce in March.  If either CVD or AD fines are imposed, crystalline module prices will increase for both China-derived modules as well as modules made in the US and other countries.

NREL SREC webinar will feature SRECTrade, NJ BPU and MA DOER

Posted January 17th, 2012 by SRECTrade.

On Wednesday, January 18th at 3pm EST (12pm PST), SRECTrade CEO Brad Bowery will join Mike Winka of the New Jersey Board of Public Utilities’ Office of Clean Energy (BPU OCE) and Mike Judge of the Massachusetts Department of Energy Resources (DOER) for a free webinar hosted by Lori Bird of the National Renewable Energy Laboratory (NREL).

The webinar will discuss the new NREL Report on the solar renewable energy certificate (SREC) markets. The comprehensive report written by Bird, Jenny Heeter and Claire Kreycik discusses key policy issues that define the structure of these markets and offers a state by state summary of how SRECs are utilized to meet RPS goals in a growing number of states.

Registration for the free webinar is still open and there are already over 500 participants enrolled. Please click here to register.

Among other data, the NREL Report dives into SREC market pricing, tracking spot and forward sales in each state. Below is a chart from the report reflecting spot market pricing on SRECTrade from a 2-year period between 2009 and 2011.

SREC Prices 2009-2011

To learn more, download the NREL Report and/or register here for the webinar at 3pm EST on January 18th.

Pennsylvania Solar Bill Goes to Committee

Posted January 17th, 2012 by SRECTrade.

On Wednesday, 1/11/12, Pennsylvania House Bill (HB) 1580 sponsored by Rep. Chris Ross (R-Chester) was presented to the House Consumer Affairs Committee for debate.  HB 1580 is a proposal to move forward the Pennsylvania SREC requirement to the current compliance requirement for 2015 without changing the overall number of SRECs required after 2015. This would alleviate the over-supply of SRECs and increase the value of Pennsylvania SRECs.  While the hearing was a critical first step for HB 1580, followers of the Pennsylvania solar industry will have to wait on the Consumer Affairs Committee’s vote before the fate of the bill is known. Should the bill make it out of committee it will also need to pass the House and Senate where both the House and Senate have voiced initial majority support for bill.

During the hearing solar industry representatives and solar consumers testified in support of the bill while utility groups and the Pennsylvania Chamber of Business spoke against it. The PA Environment Digest put together a detailed account of the testimonies. Generally those in support of the bill argue: 1) that the bill is essential for maintaining highly skilled solar jobs in Pennsylvania; 2) doesn’t increase the overall requirement for SRECs; 3)merely accelerates the requirement and 4) brings Pennsylvania’s SREC market more in line with the design of other SREC markets by closing the market to out-of-state sited systems (currently PA accepts SRECs from anywhere in the PJM region i.e most states in the mid-Atlantic and some states in the Midwest). Utility companies that testified against the bill argue that it would place an undue burden on rate payers by forcing utilities to charge more for the electricity that they supply. According to the PA Environment Digest article, there was some disagreement over the actual cost of the bill to rate payers, but on the high side utilities estimate that it would be an increase of $120 million over four years to four million Pennsylvania rate payers, which equates to an increase of about $3.33 per year to each rate payer.

SRECTrade will continue to closely monitor the development of HB 1580. Stay tuned to our blog for updates.

Potential new meter requirements for all systems in NJ

Posted January 12th, 2012 by SRECTrade.

Last spring the NJ BPU quietly proposed a change to the renewable portfolio standard rules that would require revenue grade meters for all existing and future solar systems generating NJ SRECs, regardless of size. The change was buried deep in a number of minor updates to the portfolio standard rules, you’ll have to scroll down to page 8 at and look carefully. By the clever use of [ ] the paragraph in the rules that previously allowed the use of engineering estimates for systems less than 10kw is eliminated. What does this mean for solar system owners in NJ?

1. Everyone will have to install a revenue grade meter and in order to continue to create SRECs, even existing systems less than 10kw. There is no grandfathering clause. Note that most existing inverter meters or online monitoring systems do not meet the revenue grade requirement. As a result, most existing systems less than 10kw without a separate meter will need to contact their installer or an electrician to have a new meter installed.

2. Everyone will have to enter monthly meter readings in order to be credited with SRECs. Most metering systems are not set up to automatically enter meter readings each month, even online systems. SRECTrade customers enrolled in the EasyREC asset management system can enter their readings online through their account and be assured that their generation will be credited properly.

These requirements go into effect 6 months after the BPU passes the rule change. While the public comment period ended on July 1, 2011, the BPU has not yet acted on the rules and has no published schedule for when they intend to do so. As a result, these rules are not yet in effect and they may not ever go into effect, so you may not want to have the meter installed until you know you’ll have to. While the comment period is closed, the email address is always open and it can’t hurt to express your opinion on this rule change if you feel you will be impacted by it.

SRECTrade will continue to monitor this issue and post any updates as they occur. SRECTrade clients will be personally emailed if and when an additional meter is required for their systems.

New Jersey Solar Legislation Doesn’t See the Light

Posted January 10th, 2012 by SRECTrade.

New Jersey legislation to modify the state’s renewable portfolio standard (RPS) in order to increase demand to soak up existing excess supply failed to pass the NJ Legislature yesterday. In fact, the bill (S-2371) never even came to a vote because of disagreements among solar advocates, who were not in lockstep over issues such as the mix between distributed net-metered and larger utility scale projects.

Although Governor Christie signaled broad agreement with the majority of the bill in his Energy Master Plan, released in December, several last-minute changes were made in the final 2 days of the session. The complexity of these changes was apparently too great to digest given the limited time available. The view of the new legislature on this issue should not change appreciably with the start of the next session and the Governor’s support is clear.

At this point it is a matter of priority and the ability to put together a new bill and get it scheduled for a vote early in the new session. Although a setback for the solar industry in New Jersey for now, hopefully increased time to craft and debate the new bill will allow for more transparency and a lead to a better quality piece of legislation.

January 2012 SREC Auction Results

Posted January 10th, 2012 by SRECTrade.

SRECTrade’s January 2012 SREC Auction closed last week. Below are the clearing prices by vintage across the markets SRECTrade is currently active in.

January SREC Prices Energy Year Ending
State 2010 2011 2012*
Delaware $65.00
Maryland In-State $204.99
Maryland Out-of-State $35.00
New Jersey $245.00 $245.00
Ohio In-State
Ohio Out-of-State $30.00 $35.00
Pennsylvania $20.00 $29.99
Washington, DC $250.00 $270.00

*Delaware, New Jersey and Pennsylvania operate on a June-May energy year.
Green text represents a price increase over the last auction clearing price for that vintage, red text represents a decrease.
“-” reflects no sale, which would result if there were no matching bids and offers that cleared for a sale in the auction.

State Market Observations:

Please note, all capacity references are from the latest SRECTrade capacity analysis and reference the amount of supply registered as of the end of December. Additional details regarding SREC issuance are provided in the capacity analysis.

Delaware (Supply: 25.5 MW | Demand: 19.8 MW): Pricing increased slightly this period, trading up to $65.00/SREC. The Delaware PSC approved the SREC Procurement Pilot Program for long term contract solicitations. As of January 3, 2012, PJM GATS reported the issuance of approximately 13,560 DE2011-12 vintage SRECs. Additional SRECs from prior eligible periods may also impact the market should there be a demand for these older vintage SRECs.

Maryland (In-state Supply: 37.8 MW | Demand: 27.6 MW): SRECs declined slightly to $204.99 this past auction period. While not seeing any demand all year long, MD2011 Out-of-State traded at $35/SREC. The state continues on pace to maintain a balanced supply relative to demand for the compliance year. As 2011 compliance obligations are finalized, a shortage of SRECs in the state, if any, will be reflected by an increase in prices at the end of the trading period.

Massachusetts (Operational Supply: 32.5 MW | Demand: 55.7 MW): There was no sale of MA2011 SRECs this period. The next quarterly MA SREC auction will close on Tuesday, January 17, 2012.

New Jersey (Supply: 483.2 MW* | Demand: 368 MW): The 2012 market increased to $245 this auction period. Approximately 15% of the available supply in the auction cleared, representing a gap between buyer and seller’s expectation of value. Oversupply continues to grow as the state has averaged 32.0 MW installed per month since the beginning of the compliance period. October 2011 saw an increase in 41.2 MW. *Note: This figure represents the capacity registered in PJM GATS as of December 2011. Please reference the capacity analysis link above for details on NJ Office of Clean Energy installed capacity figures.

Ohio (In-State Supply: 29.0 MW; Out-of-state Supply: 68.0 MW | Demand: 39.1 MW) : There was no sale of OH2011 sited SRECs. The out-of-state SREC market saw activity, increasing in value from $30/SREC to $35/SREC.

Pennsylvania (Supply: 159.4 MW | Demand 41.2 MW): PA2011 SRECs traded up to $20/SREC and PA2012 increased to $29.99/SREC. HB 1508 will go before the Pennsylvania Commerce Committee this Wednesday, 1/11/12.

Washington, DC (Supply: 21.7 MW | Demand: 41.9 MW): Prices continue to increase as legislation closing the DC market borders and increasing requirements take effect on the market. The 2010 vintage cleared at $255.16/SREC, while the 2011 vintage cleared at $270/SREC. Note, the SREC and capacity figures do not take into consideration the amount of electricity delivered into the district that may be exempt from complying with the Distributed Generation Amendment Act increases, considering some electricity contracts may have been signed prior to the amendment’s implementation

For historical pricing please see this link. The next SRECTrade auction covering Q3 MA2011 generation closes on Tuesday, January 17 at 5 p.m. ET. The following auction covering all markets closes on Tuesday, January 31 at 5 p.m. ET.

New Pennsylvania SREC Application Requirements

Posted January 9th, 2012 by SRECTrade.

The PA Alternative Energy Program Administrators (AEPS) have changed the requirements for applying for SREC certification numbers. Any systems that apply for PA certification after 1/1/2012 must now provide the following:

Photos of the array- The photos must show the entire array. Multiple photos should be provided if necessary.

Photos of the meter- The photos of the solar production meter or inverter (if no solar prooduction meter is installed) must show the kW-hr production at the time that the application is submitted. This meter reading will be the starting point for earning SRECs. For example, if the meter reads 500 kW-hrs at the time that the application is submitted then any future meter readings submitted will have 500 kW-hrs subtracted from them to determine SREC production.

Pennsylvania House Bill 1580 Update

Posted January 9th, 2012 by SRECTrade.

House Bill (HB) 1580 will go before The Pennsylvania Commerce Committee on Wednesday, 1/11/12. This is the third date that has been scheduled for the committee hearing. HB 1580 is a proposal to accellerate the Pennsylvania SREC requirement by three years from 2013 to 2015. If the Bill passes committee on Wednesday then it will also need approval by the House and Senate. Currently the House is majority in favor of the current bill and the Senate looks to be in favor of passing a similar version should the House come to a resolution. SRECTrade will post a blog update once we get word on the Commerce Committee decision.