SRECTrade is expanding into several other PJM Region states in July of 2009. As part of this expansion, we are utilizing this blog to help introduce our customers to the individual state SREC programs. Maryland’s Renewable Energy Portfolio Standard (RPS) requires electric service providers to provide 20 percent of their sales in the state from renewable energy sources by 2022. There is a specific carve-out for solar-generated electricity, currently at .01% for 2009 and set to reach 2% by 2022. Much like other states, electricity suppliers must make an alternative compliance payment (ACP) into the Maryland Strategic Energy Investment Fund should they not meet each yearly requirement.
Maryland is unique because the RPS mandates that electricity suppliers buying from individual solar owners must enter a 15-year contract for the sale of all the owner’s SRECs produced during that time. Due to uncertainty of the future, electricity suppliers have been disinclined to buy SRECs in this manner, and thus both sides have mutually used third parties (as allowed by law) as a means of transferring the credits between individuals and electricity suppliers. The SRECTrade auctions will serve as means to sell SRECs for sellers who are unable to lock into the 15-year contracts.
Meanwhile, Fred Ugast, an advocate for Maryland solar owners at U.S. Photovoltaics, has been working to secure 15-year contracts for their SRECs. He has familiarized us with the Maryland market and we are following his progress in this endeavor. According to Fred, there were 94 solar photovoltaic (PV) systems eligible to create SRECs in 2008, and 252 SRECs were created. This left estimated solar ACP payments at nearly one million dollars. The demand for SRECs in Maryland is approximately 5,000 in 2009, but supply is expected to increase at a faster rate over the next few years. SRECTrade hopes to be an integral part of matching that supply with demand in Maryland. Please check back as we learn more!