SREC Crash Course: The Basics

1. What is an SREC and how are they produced?

An SREC is a Solar Renewable Energy Credit that is produced for every 1000 kWh (1 MWh) of production your Solar System generates. They are production-based incentives that represent the green attributes produced by your solar project. These SRECs are state incentivized credits that can become a passive income for the solar system owners. Any size system is eligible to participate in SREC selling. 

Who buys and how do I sell?

States opened up the SREC market by mandating that utility companies are required to have a certain percentage of clean energy attributes each year. This is referred to as the Renewable Portfolio Standard (RPS) or Clean Energy Standard. If companies are unable to reach their requirement, they are able to buy renewable energy credits from privately owned solar projects. 

We partner with solar installers to make this process as easy as possible for solar owners. We will receive information about your system directly from your solar installer and will provide you with a customized contract proposal.

CSG offers a variety of payment options based on the state your system is located in.

How much can I make?
Since SREC’s are state incentivized, the state largely determines what the price per REC is selling for with supply and demand factoring second. SREC’s are worth different amounts in different states and can range from a market of around $4.00 to over $300 per SREC. In your personalized contracts, you can see which payment structures are available and how much we are offering.

 

Payment Options

Full Upfront - One Upfront Lump-Sum Payment

This option is one payment upfront. This is a “pre-payment” for SRECs generated for the entire term of the contract. We calculate this payment based on your estimated production for that term. The price is discounted from the current market price. Payments are sent 45 days after registration approvals.

Short-Term Locked-In Rate - Fixed Price per SREC with a shorter term

This option also has a locked-in price per SREC but offers a shorter term. You will be paid annually between December and February based on your previous year’s actual production.

Market-Based - Current Market Rate Minus Commission

The timing and amounts of the payments will fluctuate with the market. We will sell your SRECs (based on the actual production) at least once per year. Payments will be made within 45 days of the sale of the SREC and a set commission will be deducted from your payment.

Frequently Asked Questions

Is my power bill and net metering affected by selling SRECs?

Your power bill is unaffected by SRECs. SRECs are "Solar Renewable Energy Credits" and they represent the environmental attributes of the power that you produce. You will not see any changes on your utility bill. Selling your SRECs has no impact on Net Metering. You can participate in both Net Metering and sell SRECs at the same time. This is because Net Metering has to do with excess energy production, whereby you can receive a credit from your electricity supplier. SRECs are solely the environmental attributes, so if you use all of your production, or put all of it back on the grid for others to consume, it has no impact on your SREC production or ability to sell them. SREC brokering and Net Metering are separate incentive programs that allow solar owners to make back money.

Why might I opt out of selling my SRECs?

Since SREC’s are recognizable as doing your part to be green and promote clean energy, you might want to consider holding on to your RECs if you are a business owner. Business owner’s are then able to advertise that their business is a clean energy leader in the community and demonstrate their commitment to clean energy and business’s sustainability goals!

Can I sell my SRECs in a state market I don't live in?

It depends! Some markets do allow for systems located outside that state to participate. However, it is usually at a lower tier or class of the market which is substantially less than the "in-state" price. CSG will register your system in the highest-priced market that your system is eligible to receive. Every state market has different eligibility requirements and your system may not qualify. Check out our SRECS by State sections for more information.