SREC markets currently exist in the following states:
- Ohio SRECs
- Pennsylvania SRECs
- New Jersey SRECs
- North Carolina SRECs
- Massachusetts SRECs
- Delaware SRECs
- Maryland SRECs
- Washington D.C. SRECs
- SRECs in these states are eligible to sell in other states: IL, IN, KY, MI, NY, TN, VA, WV, WI
How much is an SREC worth?
The value of an SREC is determined by market supply and demand forces, which ultimately depend on the number of solar installations qualified to produce SRECs, and the number of qualified system that actually sell those SRECs. SREC demand is also determined by a state’s Renewable Portfolio Standard or RPS solar requirement, i.e. what percentage of electricity in the state must be produced by a renewable energy source.
Here are a few examples of spot prices for SRECs in September 2010 (note that long-term SREC contracts will have slightly lower pricing):
- District of Columbia $290
- Maryland $326
- New Jersey $625
- Ohio $300
- Pennsylvania $300
How does a residential solar system get SREC certified?
In order to produce SRECs, a home solar system must be certified by state regulatory agencies, which usually means public service commissions or public utility commissions. Once that’s done, the system must be registered with a trading platform (your solar installer can help you with this). SRECs are then issues based on an estimate table or actual meter readings depending on state regulations. One SREC is created for every MWh of electricity.
How to turn an SREC into money?
1. Sell them to a middle man. They group together SRECs like yours and sell them, usually to utilities. The benefit here is that they take on some of the risk for estimating future value of the SRECs, they pay you up front, as well as handle all the administration work. Of course, they will charge a fee of 3% or more of the SREC value, but that can be worth your time and peace of mind. Usually, if this is an option your solar installer will already have a relationship with one of these companies.
2. Register your SRECs and trade them on the open market. Right now this is available in very limited places, and requires being a very savvy consumer.
Think of these two options as the difference between mutual funds and trading individual stocks. One’s safer and easier with a more consistent but limited benefit.