New Jersey’s SREC Program Overview

NJ started a major push towards renewable energy back in 2001.  At that time, there was a goal to have 30% of the states energy use created by renewable technologies come the year 2020. Well, as you know, 2020 is not too far away now.  In order to meet that goal, the state put together some of the most advanced programs in the United States.  To date, New Jersey has more solar electricity installed than any other state except California which is very impressive.  In order to meet the renewable energy goal set out for 2020, New Jersey energy administrators knew that there needed to be some financing plans and incentive plans in place, otherwise people and businesses would simply not be able to afford solar panels.  The NJ SREC program is a key component to making the overall New Jersey Clean Energy Program work.

What Is A SREC(Solar Renewable Energy Credit)?

An SREC is a unit of measurement of electricity that is produced.  One SREC is given to a renewable energy operator each time 1,000 kWh of electricity is produced.  The actual SREC is not electricity, but rather a certificate marking another 1000 kWh’s of clean energy production.  And the SREC’s are quite valuable because they can be traded and sold at a later date.

How are SREC’s Tracked and Accounted For?

SREC’s are tracked by a tracking system which records all of the solar energy producers and the sizes of their systems.  There are several calculations that take place, and the overall goal is to either estimate or record the known production of electricity from everyone’s solar systems.  This tracking system also records each time a SREC is awarded to an operator of a solar system.  This centralized tracking system makes it very easy for owners of solar to understand how many SREC’s they have earned.

How Can You Sell Your SREC’s to the Utility Companies?

The sale of SREC’s is the biggest benefit to this entire program. When you have accumulated SREC’s, you are then able to trade or sell them to interested buyers.  The most common buyer of the SREC’s are the state utility companies.  As the utilities companies need to meet state laws regarding clean energy production, they are able to purchase SREC’s from the private sector to make up for any lack of clean energy production they have.  This is something that really benefits owners of solar because they are actually selling the credits right back to the utility companies.  The actual value of the SREC’s can and does fluctuate.  Since it is an open market to purchase SREC’s, everything is again based upon supply and demand.

What is the Value of a SREC in New Jersey?

The Value of Solar Renewable Energy Credits in New Jersey is always changing.  Here are some of the average prices that were paid for SREC’s over the past few months:

NJ SREC Dollar Value Chart:

(The actual dollar value per SREC is located in the far right column.  You can see they are usually worth about $500-$600 for each solar renewable energy credit.)

How Do You Register Your Solar System for the SREC Program?

People interested in taking part in the SREC program must register their intended solar system prior to constructing or installing the solar panels.  Once you have submitted your application for the SREC program, you will be notified within about 6-8 weeks.  If you are taking part in the New Jersey solar system rebate program as well, you will be automatically enrolled in the SREC program too.

Conclusions

New Jersey is by far one of the most advanced states with regards to their renewable energy programs and incentives.  The ideas and motivations behind the SREC program are definitely promising for the rest of the country to follow and recognize.  In order for anyone to be able to afford solar power, incentives right now are necessary, and long-term solar incentives like the SREC program are very valuable to everyone.