Many US states realize the important impact of solar development, and are riding the solar wave full speed ahead. DC is the perfect example of that – imparting some of America’s best incentives in the solar movement onto its residents and. It’s all part of DC’s ambitious goal to shift energy production to renewable energy, reduce people’s monthly electricity bill, and boost the economy. The SREC supply in DC is making solar more attractive to potential solar owners as they represent a significant source of revenue.
It’s time to consider going solar in Washington, DC
With federal tax credits and state incentives already making your initial solar installment, Solar Renewable Energy Certificates (SRECs) can help you earn hundreds of dollars more per year. SRECs are virtual certificates or credits from which your solar system earns when it produces 1,000 kWh of renewable energy (one SREC per megawatt-hour of electricity produced), and each SREC is worth money when you sell it to your utility supplier. This is because DC’s Renewable Portfolio Standards require utility suppliers to supply a certain amount of SRECs per year or else they will face penalties. Here’s where it gets interesting for solar owners.
When SREC supply in DC is in shortage, it benefits solar energy system owners. SREC prices are determined by supply and demand. Due to high demand in SRECs by electricity companies who must meet DC’s policies,, recently hitting $440 per certificate. Peak prices occur at peak demand, reaching their maximum possible value of $500. Bottom line, utility suppliers must buy SRECs from solar owners according to the variable market price as purchasing proof of clean energy production in order to meet targets and avoid paying penalties. Therefore, the best time to sell your SREC is when the market reaches high value.
SREC supply in DC
DC’s robust solar SREC market is a combination of their ambitious solar goals, restrictive development areas, and a law passed in 2011 to block out-of-state solar producers from participating in DC’s SREC market.
With financial incentives making solar more accessible to its residents, DC ranks on top for having the most attractivein the country. In 2016, DC passed the RPS Expansion Act that further added to their energy progressive laws. The requirements specify a “solar carve-out” which will increase the number of installations supported each year, setting their renewables target at 50% by 2032. The new legislation will also help gain access to savings opportunities and lower their electricity bills, as a result.
Although this mandate bodes well with solar owners selling SRECs in the market, the transition for utility suppliers to adjust to these standards could create some instability in the SREC market, causing prices to slightly decrease. However, SREC forecasts are good as power providers will adapt to the policy changes. Nevertheless, SREC prices remain high due to undersupply, which makes solar power more financially viable than ever.