Solar Renewable Credits (SRECS) In Warrenton, Virginia
Thanks to the Virginia Clean Economy Act passed in 2020 Virginia now has an SREC market. The current value is $30-60 per SREC with options for selling at the market rate or with locked-in future contracts. Keep in mind that income from SREC sales is subject to income taxes.
Solar Renewable Energy Credits (SRECs) are a hot topic these days!
SRECs aren’t a physical thing, rather an accounting of solar energy generated. Every 1,000 kilowatt-hours (kWh) a PV system produces is equal to one SREC. On average an 8 kW PV installation generates around 10,000 kWh per year and thus would also be creating 10 SRECs per year that are owned by the PV system owner. These SRECs can then be sold to generate income. Again, this does not impact in any way the net metering arrangement with the utility company.
SRECs are sold through brokers. These brokers handle registering systems, provide an easy reporting platform for clients to use, and manage the sales of the SRECs. They do take a cut of the sales for their efforts and their fees are posted on their sites. Baseline Solar has primarily worked with SRECTrade in the past and we continue to find them an excellent partner. SolSystems is another fine option that some of our customers work with. Learn about Federal Tax Rebates
Many of our clients with systems installed in 2016 and earlier were registered for SREC sales in Pennsylvania through SRECTrade. We stopped registering systems in 2017 because the market rate for SRECs was very low and because that year PA also closed their doors to systems located outside of PA. We had nowhere to sell! Thanks to the Virginia Clean Economy Act passed in 2020 Virginia now has an SREC market. The current value is $30-60 per SREC with options for selling at the market rate or with locked-in future contracts. Keep in mind that income from SREC sales is subject to income taxes.
Getting set up to sell SRECs generally requires registration of the PV system which includes some paperwork generally handled by us, the installation company, and come from you, the system owner, and it also often requires some additional hardware to be installed for recording solar generation. Because of the flood of people trying to register to sell SRECs in Virginia, the brokers are fairly backed up in processing applications. Our company is also very busy these days with installation work, but we are working to add some capacity to our team to help with SREC registrations for our past and future clients. It will take us and the brokers some months to be able to catch up on registering past clients. Do not expect to be selling SRECs in 2021! It will likely be early 2022 before we and the brokers are caught up.