Less than 24 hours before the start of the DOER Solar Credit Clearinghouse Auction (SCCA), referenced here and officially here, the Massachusetts DOER announced the preliminary SREC compliance obligation for 2014. The DOER’s original email can be found here.
A quick look at the numbers
The official 2014 SREC requirement is 498,951 SRECs, however 4,369 SRECs are deducted from the overall requirement because of a settlement between TransCanada, a power supplier, and the DOER. This gives us a final number of 494,582 SRECs required. If the SCCA goes to the 3rd round, the 2014 compliance obligation will automatically increase by the volume deposited, 38,866 SRECs, resulting in a new 2014 net compliance obligation of 533,448 SRECs.
Approximately how much more solar is needed in 2014
According to the DOER’s calculation worksheet, 245.9 MW of capacity is currently qualified (installed through July 25). In simple terms, the 2014 compliance requirement equates to an average of 426.4 MW or 459.9 MW operational all year long to mint the 494,582 or 533,448 MWh requirements (note the 2 scenarios depend on whether or not the the upcoming SCCC reaches the 3rd round). Also, its important to note that the MW equivalent figures only take into consideration SRECs issued during the 2014 compliance year. We already know there is excess supply from 2012, the volume banked and deposited into the SCCA, and oversupply from 2013 that will effectively reduce the capacity needed online throughout 2014 to meet the Solar RPS requirements.
The difference between the 245.9 MW qualified and the capacity needed under each 2014 scenario is a difference of 180.5 MW or 214.0 MW. Given the recent qualified and pending SQA lists, there are approximately 435 MW eligible but not yet operational. This means that approximately 40-50% of the eligible, not operational capacity would need to be installed by 12/31/2013 (without including oversupply from previous periods) to have enough solar capacity, by the beginning of the year, issue the 2014 MA SRECs required.
Timeline for large project installations
Projects that are greater than 100 kW in capacity and eligible for the current program must be operational by 12/31/13 or demonstrate that they have expended at least 50% of the project costs before the end of the year to receive an extension until the end of June 2014. Projects that can demonstrate substantial delays originating from the interconnecting utility can possibly receive longer extensions. This means that it will be at least until the end of the year, if not June 2014, before we understand the final shake out of installed capacity eligible under the current SREC program.
SREC II Program Meeting
The DOER will hold a stakeholder meeting to discuss the next SREC program on August 12th from 1 to 3 pm ET. The meeting will be held in the Gardner Auditorium of the Massachusetts State House in Boston. Further information on the SREC II program can be tracked here. The email announcing the meeting is linked here.