Archive for the ‘Washington, DC’ Category

Washington, D.C. SREC Market Update

Posted November 17th, 2020 by SRECTrade.

The SREC market in Washington D.C. has seen a change in trends due to changing market conditions associated with COVID-19. Our enclosed analysis provides an update on these market conditions and evaluates future market dynamics.

Compared to our last market update – posted on May 22, 2020, we project a greater oversupply in 2020 & 2021 and our new analysis shows 2022 now slightly oversupplied in high build rate scenarios.  Despite this, we expect the market to flip to undersupplied in 2023, or sooner in low build rate scenarios.

This change in dynamic can be attributed to several factors including:

  • COVID related decline in electricity sales resulting in lower SREC demand
  • Higher build rates resulting in higher forecasted SREC production 
    • 1.65 Last Twelve Month Avg. (MW/mo) (May Analysis) vs.
    • 2.49 Last Twelve Month Avg. (MW/mo) (Current Analysis)

In this time of uncertainty, there are several fundamental considerations that could impact the final supply and demand figures over the next coming months. Final 2020 DC SREC production, Q4 build rates, and actual grandfathered load will need to be analyzed to determine the degree of oversupply and more accurately project future market conditions.

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

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.

District of Columbia SREC Market Update

Posted February 22nd, 2019 by SRECTrade.

On January 18, 2019, the mayor of the District of Columbia signed the CleanEnergy DC Omnibus Bill Amendment Act of 2018, increasing the District’s Renewable Portfolio Standard to 100% by 2032 and the solar carve-out to 10% by 2041. Notably, the Act increased the useful life of an SREC from three to five years and drew forward the legacy solar requirement by two years. As a reaction to these policy changes, the District’s SREC market has seen a much-needed jump in both pricing and liquidity, after over a year of falling SREC values and thin market conditions. Since the market bottomed-out in Q4 of 2018 at $295 per credit, we have seen a dramatic pricing swing of nearly 30%, to $380 per credit. The enclosed analysis examines the fundamental market conditions which are driving this increase in market pricing and liquidity.

With the enactment of the CleanEnergy DC Omnibus Bill Amendment Act of 2018, electric load can now be placed 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

According to solar alternative compliance payment (SACP) data in the DCPSC Annual RPS Report for Compliance Year 2017, approximately 75% of the District’s 2017 electric load was grandfathered under the legacy SACP levels from the DG Amendment Act of 2011. Based on this information, we made the calculated assumption in our analysis that the percentage of 2019 electric load in each respective bucket is as follows: twenty-five percent (25%) in bucket 1, fifty percent (50%) in bucket 2, and twenty-five percent (25%) in bucket 3. We assumed that bucket 1 would roll off completely by 2020 and bucket 2 by 2022. Beginning in 2022, all load will be subject to the solar requirement and SACP provisions in the CleanEnergy DC Omnibus Bill Amendment Act of 2018.

Using these assumptions and flat load growth moving forward, we will likely see the market shift from an oversupplied to an undersupplied dynamic beginning in 2020. However, even with a near-certain oversupplied dynamic in 2019, the ability to bank credits for five years allows market participants to more flexibly utilize these SRECs, providing buoyancy to 2019 vintage SREC pricing. Barring an unprecedented increase in solar build rate or decrease in statewide electric load served, we expect this policy change to provide SREC pricing stability for the foreseeable future.

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

District of Columbia Passes Landmark 100% Renewable Energy Bill

Posted December 19th, 2018 by SRECTrade.

On December 18th, the District of Columbia City Council unanimously approved the CleanEnergy Omnibus Amendment Act of 2018, which among a number of other environmental initiatives, mandates the District be powered by 100% renewable energy resources by 2032. While a number of other states, including California and New York, have approved similar 100% clean energy mandates, the Act requires the District to meet its 100% target nearly a decade earlier than any other state. This puts the District at the forefront of a growing wave of local and state initiatives, nationwide, working to implement robust and resolute clean energy programs.

In addition to doubling the RPS mandate, the Act pulls forward the solar RPS schedule by two years and extends the solar requirement to 10% of electricity sales by 2041. Notably, the Act extends the useful lifetime of an SREC from three to five years, providing more price stability within the SREC market and stimulating investor confidence. The Act also includes provisions to provide further transparency with respect to load exemptions, requiring EDCs and LSEs to publish their electricity sales exempt from compliance obligations in their annual RPS compliance reports.

Mayor Muriel Bowser has 10 business days to sign the Act, veto it, or let it pass without her signature. While the Mayor is expected to sign the measure, a unanimous vote from the Council would override any veto from the Mayor.

Once the Act goes into law, SRECTrade will release a full analysis outlining the effects this change will have on the District’s SREC market.

 

Washington D.C. City Council Advances CleanEnergy Omnibus Bill to Second Reading

Posted November 29th, 2018 by SRECTrade.

On Tuesday November 27th, the District of Columbia City Council voted unanimously to advance the CleanEnergy DC Omnibus Amendment Act of 2018 to a second reading. Most notably, this bill increases the District’s renewable energy mandate to 100% by 2032 and solar energy mandate to 10% by 2041.

In summary the bill addresses the following:

  1. Increases the lifetime eligibility of SRECs from three to five years
  2. Requires electricity suppliers to submit annual compliance reports which include the number of exempt load contracts from the Renewable Energy Portfolio Expansion Amendment Act of 2016 and the CleanEnergy DC Omnibus Amendment Act of 2018, respectively, in calendar years 2019, 2020, 2021, and 2022
  3. Draws forward the solar carve out requirement schedule by two years and extends the Alternative Compliance Penalty (ACP) schedule as follows:


The bill also addresses emissions reductions in the transportation sector, requiring that all public transportation and fleet vehicles become electric by 2045.

The second reading is scheduled for December 18th. If the Council votes on confirming the bill, it will be sent to the Mayor’s desk, who will have 10 business days to sign, disapprove, or let the bill pass without her signature. Further amendments could be made to the bill over the next three weeks. SRECTrade will continue to update participants on any updates made to the bill and progress on any significant legislative proceedings.

Washington, D.C. SREC Market Update

Posted July 8th, 2018 by SRECTrade.

In recent months, the Washington D.C. SREC market has seen a relative lack of liquidity compared to prior compliance years and a resulting downward impact on pricing. This dynamic has developed as a result of the Renewable Portfolio Expansion Act of 2016, which allowed for electricity load signed under contract prior to October 8, 2016 to be grandfathered under the old Solar Alternative Compliance Penalty (SACP). With the current Calendar Year 2018 (CY2018) SACP at $500/MWh and the old CY2018 SACP at $300/MWh, electricity suppliers with grandfathered load have opted to pay the lower SACP fee instead of purchasing SRECs for each MWh of compliance associated with load under a grandfathered contract. As such, effective SREC demand has been temporarily reduced.

In CY2017, 28.8% of the compliance obligation was met through retirement of DC-eligible SRECs. This implies that 71.2% of the compliance obligation was met through SACP payments and, correspondingly, 71.2% of 2017 load obligation was grandfathered under the old SACP. Details of this can be found in the DC Public Service Commission’s Report on the Renewable Energy Portfolio Standard for Compliance Year 2017 (see pages 15-17 specifically). With each subsequent year up through 2021, a portion of this load will roll off of contract, incrementally increasing SREC demand. The enclosed analysis assumes that these contracts will roll off in equal intervals each year over the next three years. As such, the analysis assumes that beginning in CY2020, there will be no load remaining under a grandfathered contract. While this may not be the case (since it is possible there were five year load contracts signed in 2015/2016), we assume that the majority of grandfathered contracts have a three year term and will expire by CY2020.

Reflective of the $200 difference between the previous program’s and current program’s SACP for CY2018, the price of SRECs have decreased from $470 in February 2017 to approximately $370 in July 2018. Under our assumption, approximately 40% of electric load remains under grandfathered contracts for CY2018. We can gather from this statistic that approximately 40% of compliance from CY2018 will be met through SACP payments and the remainder will be met through the purchase of SRECs. The enclosed analysis demonstrates a likely oversupply in the current 2018 compliance year. At current build rates of 1.14 MW/month, the market would be approximately 30% oversupplied in 2019, nearly balanced in 2020, and move to a state of under supply in 2021, 2022, and 2023. The presentation also demonstrates the expected supply relative to RPS solar demand at greater build rates from the last twelve month average.

Please click on the preview below to see the full analysis:

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

Disclaimer. This document, data, and/or any of its components (collectively, the “Materials”) are for informational purposes only. The Materials are not intended as investment, tax, legal, or financial advice, or as an offer or solicitation for the purpose or sale of any financial instrument. SRECTrade, Inc. does not warranty or guarantee the market data or other information included herein, as to its completeness, accuracy, or fitness for a particular purpose, express or implied, and such market data and information are subject to change without notice. Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or implied, is made regarding future performance. Any comments or statements made herein do not necessarily reflect those of SRECTrade, Inc. SRECTrade, Inc. may have issued, and may in the future issue, other communications, data, or reports that are inconsistent with, and reach different conclusions from, the information presented herein.

Copyright. This document is protected by copyright laws and contains material proprietary to SRECTrade, Inc. This document, data, and/or any of its components (collectively, the “Materials”) may not be reproduced, republished, distributed, transmitted, displayed, broadcasted or otherwise disseminated or exploited in any manner without the express prior written permission of SRECTrade, Inc. The receipt or possession of the Materials does not convey any rights to reproduce, disclose, or distribute its contents, or to manufacture, use, or sell anything that it may describe, in whole or in part. If consent to use the Materials is granted, reference and sourcing must be attributed to the Materials and to SRECTrade, Inc. If you have questions about the use or reproduction of the Materials, please contact SRECTrade, Inc.

Market Implications of Recent D.C. RPS Bill

Posted June 9th, 2017 by SRECTrade.

SREC market structure is primarily determined by two major policy levers: Renewable Portfolio Standards (RPS) and the Alternative Compliance Payment (ACP). RPS schedules determine the amount of energy coming from various renewable generation sources, solar included. ACP schedules set the maximum possible price that credits such as SRECs can reach in the market. When a state adjusts the RPS or ACP, market participants on both the demand and supply sides of the SREC market need to adapt to the new environment defined by these two factors. This transition often takes time to complete and can create market instability and uncertainty in the interim.

The Washington, DC market is currently in the midst of such a transition. The Renewable Portfolio Standard Expansion Act of 2016 (B21-0650), signed last July and put into effect on Oct 8th, 2016, has already made waves in the Washington D.C. SREC market. As stipulated in the legislation, state renewable generation and solar carve-out targets have increased to 50% and 5% respectively by 2032. The bill complements this RPS expansion with an increase in the ACP or the financial penalty for non-compliance by electricity suppliers. The side-by-side comparison of the ACP schedule before and after the recent policy shift is as follows:

dc-acp-schedules

While in theory this ACP increase bodes well for owners of photovoltaic systems selling SRECs into the market, we have seen a slower demand adjustment from the utilities and power providers, the DC market’s natural compliance buyers. As a result, sellers have experienced a lack of liquidity for their SRECs during a time of seemingly favorable market conditions. The lack of demand for SRECs at the current spot market price can be partially attributed to a clause in B21-0650 which states that the new ACP schedule does not apply to any utility load contract entered into before October 8th, 2016. This grandfathering of competitive electricity supply contracts means utilities and load serving entities (LSEs) have two different RPS programs they are simultaneously subject to, as some of their contracts are subject to the old $350 ACP and some subject to the new $500 ACP. In effect, SREC demand is split between the old and new program.

Reflective of the $150 difference between the previous program’s and current program’s ACP for calendar year 2017, the price of DC17 SRECs increased from $320 to $480 from October 2016 to February of 2017. However, due to compliance buyers balancing their purchases between the $350 and $500 obligation levels, the market has settled to levels that reflect a balance between the two separate ACP levels for calendar year 2017.

While prices may continue to decrease slightly as compliance buyers better understand their future SREC needs, we expect that over the coming months the market will begin to stabilize and recover.  Buyers will inevitably adapt to the policy changes and assess their positions with regards to the two RPS obligations. The brokerage desk at SRECTrade has been working closely with buyers to better understand their obligations and ensure that the market remains liquid and accessible to all sellers.

As always, please feel free to reach out to the SRECTrade client services team, or your brokerage desk contact, to further discuss the current status of the market and our outlook on SREC pricing.

Disclaimer. This document, data, and/or any of its components (collectively, the “Materials”) are for informational purposes only. The Materials are not intended as investment, tax, legal, or financial advice, or as an offer or solicitation for the purpose or sale of any financial instrument. SRECTrade, Inc. does not warranty or guarantee the market data or other information included herein, as to its completeness, accuracy, or fitness for a particular purpose, express or implied, and such market data and information are subject to change without notice. Past performance should not be taken as an indication or guarantee of future performance, and no representation or warranty, express or implied, is made regarding future performance. Any comments or statements made herein do not necessarily reflect those of SRECTrade, Inc. SRECTrade, Inc. may have issued, and may in the future issue, other communications, data, or reports that are inconsistent with, and reach different conclusions from, the information presented herein.

Copyright. This document is protected by copyright laws and contains material proprietary to SRECTrade, Inc. This document, data, and/or any of its components (collectively, the “Materials”) may not be reproduced, republished, distributed, transmitted, displayed, broadcasted or otherwise disseminated or exploited in any manner without the express prior written permission of SRECTrade, Inc. The receipt or possession of the Materials does not convey any rights to reproduce, disclose, or distribute its contents, or to manufacture, use, or sell anything that it may describe, in whole or in part. If consent to use the Materials is granted, reference and sourcing must be attributed to the Materials and to SRECTrade, Inc. If you have questions about the use or reproduction of the Materials, please contact SRECTrade, Inc.

RPS Evolving: States Take On U.S. Climate Goals

Posted April 19th, 2017 by SRECTrade.

This article by Allyson Browne was originally published in the American Bar Association’s Natural Resources & Environment Spring 2017 Issue: Science & The Law. It provides an in-depth look into how states across the U.S. are carrying the country’s torch towards Paris pledges with impactful RPS programs. In addition, the article breaks down the Clean Power Plan to illustrate how states could evaluate and implement similar obligations in harmony with existing RPS policies. These state actions will be increasingly important as the EPA endeavors to review the Clean Power Plan under President Trump’s recent Executive Order

As the Clean Power Plan (CPP) undergoes judicial review and faces a likely unsupportive Trump administration on the federal stage, states across the country are bringing their renewable portfolio standards (RPS) back to the top of their legislative agendas. Although the CPP is not the primary driver of today’s RPS reformation, its future will undoubtedly impact the future of RPS policies across the country, if not cause an RPS revolution—one way or the other. Historically, federal policies, including the federal production tax credit and the investment tax credit, have served primarily to support RPS programs and renewables deployment. Moreover, the Federal Energy Regulatory Commission’s (FERC) regulation of the wholesale electricity market has increased competition in the renewables sector by reducing barriers to project development and market participation, particularly with respect to requirements placed upon electricity suppliers and utility companies for renewables integration. Examples of such regulation are FERC Order 2003, Standardization of Generator Interconnection Agreements and Procedures (issued July 24, 2003), and FERC Order 764, Integration of Variable Energy Resources (issued June 22, 2012). As states look beyond their RPS target years and goals, the CPP has the ability to influence RPS program design much more heavily than did its federal predecessors. The CPP could prompt states to more closely align renewable energy goals with emissions reduction goals, thereby minimizing legislative and regulatory overlap and enabling states—and the nation as a whole—to recognize the maximum benefits of these broader climate change policies. But this is not to say that RPS programs will weaken if the CPP is struck down. Conceivably, the rejection of the CPP could lead to a great awakening of state leadership in our clean energy and climate future.

Renewables technology has progressed significantly since the first RPS was enacted in Iowa in 1983. Iowa Code § 476.41, et seq. And RPS programs, which require retail electricity suppliers to supply a minimum percentage or amount of their retail load with eligible sources of renewable energy, are constantly playing catch-up to these ever-evolving market dynamics. Technological innovations and the diversification of financial products have driven down project costs and broadened accessibility. States have provided incentives such as rebates or net metering credits. Project developers and service providers have adapted to meet the varied conditions of their markets. The result is a diverse portfolio of U.S. RPS policies, as states across the country have designed, implemented, revised, frozen, annulled, or otherwise modified their individual RPS programs as the renewables sector has matured over the course of the past 33 years.

Today, 29 states and the District of Columbia have compliance RPS programs. Altogether, the obligations apply to 55 percent of total U.S. retail electricity sales. See Galen L. Barbose, U.S. Renewables Portfolio Standards: 2016 Annual Status Report, Lawrence Berkeley National Laboratory No. 1005057 (April 2016). And these figures do not include states with voluntary renewable energy goals, such as North Dakota, Utah, and Virginia. See Jocelyn Durkay, State Renewable Portfolio Standards and Goals, Nat’l Conf. of State Legislatures (Dec. 28, 2016).

Although most RPS programs share common elements (such as imposing penalties for lack of compliance and utilizing some form of tradable renewable energy credit (REC) to track compliance), no two states share an identical RPS. States differentiate their RPS policies with unique targets and time frames, entities obligated and exemptions, eligibility rules and definitions, carve-outs, contracting or procurement requirements, and the use of cost caps and floors. Barbose, supra. This differentiation has empowered states to design programs that best fit their needs, market dynamics, and renewables goals. Modifications can be made when and where the barrier to entry is too high, or if the RPS imposes exorbitant costs on ratepayers. Consequently, the majority of states with RPS have hit their targets, with 94 percent achievement in 2013 and 95 percent achievement in 2014. Id.

While few new RPS policies have been enacted in recent years, states continue to modify existing policies in response to changing market conditions, program success and end-dates, and federal policies. As states begin to approach their target years or achieve (or exceed) target goals, states are evaluating whether and how to extend targets into the future. Under currently enacted laws, 20 states will reach the terminal year of their RPS by 2026. Id.

Recent legislative activity evidences this period of reformation. State legislatures have introduced and enacted more than 200 RPS-related bills since the beginning of 2015. See EQ Research, available at http://eq-research.com/. Most notable are the five jurisdictions (California, Oregon, New York, Vermont, and D.C.) that have adopted policies requiring at least 50 percent renewables, and Hawaii—the first U.S. state to establish a 100 percent RPS goal. Id. In addition to extending and expanding RPS time frames and goals, states have modified RPS programs by introducing resource-specific or distributed generation carve-outs, refining resource eligibility rules and definitions, and relaxing geographic preferences or restrictions. Barbose, supra.

As we approach common terminal years in 2020 and 2025, we are likely to see continued legislative and gubernatorial action on RPS programs and renewables goals. But approaching targets are not the only reason why states are revisiting and revising their RPS policies. Endogenous factors, including compliance costs, legal challenges, and other state- and local-level market and policy conditions are the primary internal drivers of RPS reevaluation. On the federal front, continued FERC regulation and the impending decision on CPP are making states rethink—and redesign—RPS policies to ensure continued compliance with federal law. Even before CPP leaves the bench, some states are planning ahead to ensure that their RPS programs will support their CPP-compliance programs. Pennsylvania, for instance, is already designing its CPP state plan, undeterred by the U.S. Supreme Court’s February 2016 decision granting a stay on the CPP pending the resolution of legal challenges. See Susan Phillips, Wolf says PA will move forward on Clean Power Plan, StateImpact Pennsylvania (Feb. 10, 2016); and Chamber of Commerce v. EPA, 136 S. Ct. 999 (2016) (order in pending case).

The CPP is the first-ever national standard aimed toward reducing carbon pollution from power plants, the nation’s largest source of emissions. See EPA, Fact Sheet: Overview of the Clean Power Plan (2015). Recognizing that fossil fuels will “continue to be a critical component of America’s energy future,” the EPA put forth the CPP to ensure that fossil fuel-fired power plants operate “more cleanly and efficiently, while expanding the capacity for zero- and low-emitting power sources.” Id. The CPP establishes interim and final carbon dioxide (CO2) emission performance rates for two subcategories of fossil-fuel-fired electric generating units (EGUs): fossil fuel-fired electric steam generating units (i.e., coal- and oil-fired power plants) and natural gas-fired combined cycle generating units. Id.

Under the CPP, states and utilities can implement the standards and meet these goals through one of three methods: a rate-based state goal measured in pounds per megawatt hour (MWh), a mass-based state goal measured in total short tons of CO2, or a mass-based state goal with a new source complement measured in total short tons of CO2, also known as a state measures plan. States need to develop and implement plans which, when combined with other state or regional initiatives, will ensure compliance with the CO2 emissions performance rates over the 2022–2029 compliance period, and with the final CO2 emissions performance rates, rate-based goals or mass-based goals by 2030 (or later, if the CPP is further delayed). The EPA estimates that the pollution reductions required by the CPP will yield climate benefits of $20 billion, health benefits of $14–34 billion, and net benefits of $26–45 billion. Id. Complementary or additive RPS programs will amplify these benefits by incentivizing additional renewable deployment, implementing stronger energy efficiency standards, and more.

Under any of the three methods, compliance will be tracked via emissions trading. See Carbon Pollution Emission Guidelines for Existing Stationary Sources: Electric Utility Generating Units, 80 Fed. Reg. 64,662 (Oct. 23, 2015) (to be codified at 40 C.F.R. Part 60). How an existing RPS and its tracking mechanism will interplay with a state’s CPP plan and its emissions trading will depend on the state’s CPP compliance path. Under a rate-based state goal, renewable energy facilities, energy efficiency units, new nuclear facilities, or performance upgrades at existing nuclear, hydro, and natural gas combined cycle power plants will produce emission rate credits (ERCs), which represent one MWh of zero-emission generation. These ERCs will be added to the denominator of the pounds per MWh until the EGU (either individually or on a state average basis) satisfies the required rate.

A state with an existing RPS that uses RECs to track compliance will need to decide whether and how ERCs and RECs will be issued, tracked, and retired together or separately. In its guidelines, the EPA clarifies that ERCs were intended to be unique and separate from RECs, and that a single generating unit could produce both an ERC and a REC for each MWh generated where eligibility overlap exists. But in practice, managing ERCs and RECs in the same compliance universe will be no easy undertaking—there will be issues with double-counting, existing forward contracts, and whether a facility can still claim its renewable attributes if it keeps its RECs, but trades away its ERCs. Id.

Emissions trading under a mass-based state goal is much more straightforward—states will be issued emissions allowances, which can be auctioned (traded) or given away. Compliance will be determined solely on total tons of CO2 emitted. As designed, there is no direct relationship between a state’s CPP plan and its RPS; rather, the two plans would exist contemporaneously. Id.

States with RPS, energy efficiency standards, and other related programs are best suited for a mass-based state measures plan. The state measures plan allows a state to leverage its existing policies, programs, and compliance mechanisms to meet the standards imposed by the CPP. And, rather than being the primary enforcement mechanism, the mass-based emissions standard acts as a federally enforceable backstop that only kicks in if the state measures fail to achieve the required reductions. There are no ERCs under this plan, and states can continue to utilize RECs to track RPS compliance, focusing CPP compliance efforts on bolstering their existing RPS and other programs instead of establishing entirely new programs and tracking tools. Id.

It is evident that the EPA carefully crafted the CPP to exist in harmony with state RPS programs and to provide a path for all states to reduce overall emissions while incentivizing renewable energy development—including those already on the right track. And although the CPP or similar federal policies would be instrumental in accelerating America’s timetable for achieving its Paris Agreement goals, states have proven willing to push for progress on their own. Now more than ever, it is imperative that states renew their commitments to renewable energy, promoting a sustainable renewables industry that supports continued job creation, grid resiliency efforts, and energy independence. As we enter into the era of Trump—and with it, an uncertain federal position on climate policy—states will take hold of the power to determine and define the nation’s stance for renewable energy and against the threat of climate change. Will we stand united?

Allyson Browne, Director of Regulatory Affairs & General Counsel

© 2017. Published in Natural Resources & Environment, Vol. 31, No. 4, Spring 2017, by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association or the copyright holder.

D.C. RPS Bill Published in Register

Posted August 23rd, 2016 by SRECTrade.

Following Mayor Bowser’s signature last month, the Renewable Portfolio Standard Expansion Amendment Act of 2016 is now published in the D.C. Register.

A21-466 was published in Volume 63, Number 33 of the District of Columbia Register on August 5, 2016 under the Actions of the Council of the District of Columbia. The PDF of the issue is available here.

As enacted, B21-0560 raises the renewable portfolio and solar requirements to 50% and 5% by the year 2032, respectively, and adds waste heat from combined and sanitary sewage systems and effluence from wastewater treatment to the list of Tier 1 renewable sources. In addition, the bill increases financial penalties for electricity suppliers who fail to comply with the annual renewable energy portfolio standard requirements. This financial penalty is known as the Alternative Compliance Payment, or ACP. Finally, the bill establishes a program within the Department of Energy and the Environment to assist low-income homeowners with installing solar systems on their homes.

Mayor Bowser Signs D.C. RPS Bill

Posted July 26th, 2016 by SRECTrade.

D.C. Mayor Muriel E. Bowser hosted a press conference yesterday to sign the Renewable Portfolio Standard Expansion Act of 2016. As enacted, B21-0560 raises the renewable portfolio and solar requirements to 50% and 5% by the year 2032, respectively, and adds waste heat from combined and sanitary sewage systems and effluence from wastewater treatment to the list of Tier 1 renewable sources. In addition, the bill increases financial penalties for electricity suppliers who fail to comply with the annual renewable energy portfolio standard requirements. This financial penalty is known as the Alternative Compliance Payment, or ACP. Finally, the bill establishes a program within the Department of Energy and the Environment to assist low-income homeowners with installing solar systems on their homes.

Councilmember Cheh introduced the bill earlier this year, and the Council unanimously passed the bill in late June. The expanded RPS not only increases access to clean energy for D.C. residents, but establishes a long-term pipeline for green jobs and businesses by raising demand for Tier 1 RECs and SRECs. The increased demand will incentivize the continued growth of D.C.’s solar industry, which has grown by 170% over the last year. The chart below summarizes the new RPS and Solar Carve-out schedule by requirement year.
omgomg

The total RPS requirement must be met by Tier 1 Renewable Sources, which includes the new sources added by the Expansion Act. In 2032 and thereafter, the District’s RPS will be set at 50% with a 5% solar carve-out. Please note that, although the SACP Schedule is changing for the 2017+ years from the current schedule, the RPS schedule for years 2017-2023 is unchanged under the Expansion Act. It is not until years 2024 and onward that the RPS requirements are changed by this new law.

Mayor Bowser is confident that the RPS Expansion Act will enable the District’s diverse populations to benefit from solar in a meaningful way. Speaking at her press conference, she said that the District “…will serve 100,000 low-income households by 2032—that’s more than 6,000 homes per year, and we’ll reduce their electricity bills by 50%, as a result. We’ll be creating at least 100 green  jobs in the first year with that number growing every year through 2032. That means reducing carbon emissions, lowering residents’ energy bills, and providing pathways to the middle class through the burgeoning marketplace of clean energy – all at the same time.”

The newly signed legislation is slated to become effective after the Congressional review period.