Solar Renewable Energy Credits
What are SRECs?
SRECs are Solar Renewable Energy Credits and they are a type of incentive that is very important to make solar energy affordable. For every 1000 kWh of generated solar energy, you create 1 SREC. The price for SRECs can fluctuate greatly because they are a market-based incentive. About 12 years ago, they sold for $400 each, but those days are gone. About 5 years ago, they sold for only $5. Over the past several years they have sold for $30-60 each. The current price in early 2022 is $35.
SRECs expire after 3 years, so while you may want to hold on to them and try to get a better price later, you can’t wait too long.
How are SRECs different from electricity?
The electricity you use or sell back to your utility company is different from SRECs. SRECs have nothing to do with how your net-meter spins and whether you buy electricity from your utility, sell it back to them, or get credit for some future use of electricity because of how Net Metering works. Thus it is possible to have a zero energy bill by generating all your energy and at the same time get paid for your SRECs. It is even possible to have a zero energy bill, be paid by the utility for excess electricity generated, and get paid even more for the SRECs generated. With enough solar energy, you could have life-long income instead of life-long utility bills.
How do I register to sell SRECs?
Groundhog Solar will register your solar array as part of its full-service installation. Once registered, Groundhog Solar will provide all the information to you or to your aggregator so that your credits can be generated and sold.
How can I sell my SRECs?
There are 3 ways you can sell your SRECs.
- Sell to Groundhog Solar, all your SRECs for the next 25 years in one up-front sale. This is a great way to reduce the initial cost of a solar array. This also provides an extra level of assurance that Groundhog Solar will stand by the installation and long-term performance of your solar array because Groundhog Solar will be financially invested in the long-term performance your solar array.
- Have any other company aggregate your SRECs. They will likely charge a commission fee for each SREC sold.
- Sell them yourself. Groundhog Solar will assist you in registering as the seller of SRECs. You will then have to keep track of how many SRECs you generate and find buyers for these SRECs before they expire. There are typically fees associated with these sales and you are unlikely to generate enough to command ‘top dollar’ for your SRECs. But like day-trading stocks, some people like to be in total control of their SRECs.
Do I have to sell my SRECs?
No. When you sell your SRECs you are selling the legal rights to claim “I am solar powered”. Many businesses would rather make the claim that they are solar powered for marketing purposes and thus these businesses keep their SRECs. If you want to sell your SRECs and also make some claim about being solar powered, this may be possible, but your ‘claim’ would need to be carefully worded and it is suggested that a lawyer be contacted to avoid any conflicts.
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