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Archive for June, 2013

Massachusetts Emergency Regulations Announced Today

Posted June 28th, 2013 by SRECTrade.

Today, the Department of Energy Resources (DOER) announced the Emergency Regulations for the Solar Carve-out program. Market contributors expected the program to reach its 400MW cap sometime in 2014, yet on May 29th the DOER announced the Massachusetts SREC program surpassed its 400MW cap. Today’s announcement outlines MA’s solar development rules under the existing program until the DOER finalizes the second SREC program.

These emergency regulations are consistent with the criteria outlined at the DOER’s June 7th meeting. A summary of these new regulations are provided below and more details can be found in the DOER’s letter to Solar Carve-out Stakeholders here.

Projects 100kW or less will be qualified under the current program as long as they have received Authorization to Interconnect by December 31st

  • If the second SREC program is not completed by December 31st these system can become registered anytime prior to the effective date of the new program

Projects over 100kW must have received a signed Interconnection Services Agreement (ISA) by June 7th and must have a Receipt of Interconnection by December 31st

  • Project ISA’s dated no later than 6/7/2013 must be submitted to the DOER by July 5th
  • Projects may be granted extensions until June 30, 2014 if they can demonstrate at least 50% of their construction costs are expended by December 31, 2013
  • Projects can also be granted an extension if they can demonstrate that the missing Authorization to Interconnect is due to a delay from the local distribution company

A current status on the existing Solar Carve-out Program as well as a list of projects that have received their Statement of Qualification under the existing program can be found here. If large projects are listed as pending on the DOER’s Qualified Projects List they have one week from today to make sure all the necessary documents are in order. The DOER will announce the final qualified projects list July 15th 2013.

These rules will take effect immediately, but are not yet permanent. The DOER has 90 days to ensure these regulations meet the administrative procedure law and will soon announce a plan for a public hearing and comment period as part of that procedure. The DOER will announce the new total MW program cap for the first SREC program in July 2014.

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MA SREC Reminder: DOER Auction Deposit Deadline is June 15th

Posted June 14th, 2013 by SRECTrade.

The deadline to transfer MA SRECs to the DOER’s NEPOOL-GIS auction account is Saturday, June 15th. If not deposited by June 15, Massachusetts 2012 vintage SRECs will lose their compliance eligibility and cannot be purchased in the upcoming DOER Solar Credit Clearinghouse Auction. SRECTrade has transferred any unsold SRECs for clients that utilize its EasyREC asset management service. No action is required by SRECTrade’s EasyREC clients. NEPOOL-GIS account holders not utilizing SRECTrade’s EasyREC service may follow the SREC transfer instructions outlined here. SRECTrade anticipates that approximately 45,000 SRECs will be deposited in the DOER auction.

What this means for Massachusetts sellers

Massachusetts 2012 SREC transactions are effectively on hold until the start of the DOER Solar Credit Clearinghouse Auction at the end of July. The DOER auction could may include as many as three separate auction events. The results of the auction will likely be known by early August. All unsold SRECs placed in the DOER’s auction account will be offered for sale at a fixed price of $300/SREC. The DOER will administer a $15/SREC fee for managing the auction. Sellers will receive $285/SREC (less any SRECTrade fees, if applicable).

In the meantime, the first MA2013 SRECs from Q1 2013 production will be minted on July 15th, ahead of the DOER auction for MA2012 SRECs.

What is the DOER Solar Credit Clearinghouse Auction?

The DOER’s Solar Credit Clearinghouse Auction is a price support mechanism for the Massachusetts SREC market. The 2013 compliance goal is approximately 185,000 SRECs, but the market has already installed capacity eligible to produce more than this requirement. For an update on MA Solar capacity see this link. SRECs not purchased in this summer’s DOER auction will be placed back in sellers’ accounts and given an extended life of three years. These extended life SRECs will not eligible for future DOER auctions. Read here for more information from SRECTrade on the DOER auction and here for more information from the DOER’s website.

Why is the DOER auction for 2012 SRECs being held in July 2013?

Massachusetts SRECs are minted on a quarterly basis (4 times a year) with a 3.5 month delay. The last MA2012 SRECs were minted on April 15, 2013 and the first MA2013 SRECs will be minted on July 15, 2013. Compliance buyers (electricity suppliers) in the meantime must have purchased all of the 2012 SRECs they need before June 15, 2013 to meet their renewable energy requirements for the 2012 compliance year.

Why is the Massachusetts DOER auction only for MA2012 SRECs

The DOER auction is held to act as a price support mechanism in years where more SRECs are produced than compliance buyers need to purchase. For this reason the auction is held only after the Massachusetts electricity suppliers finalize their compliance filings and purchased all of the SRECs they need for the current compliance year. The excess, unsold, SRECs go in to the DOER auction and can be purchased to satisfy future compliance requirements. This is the first year the MA DOER Solar Credit Clearinghouse auction will be held. Previous compliance years were under-supplied, so no excess SRECs were available for the DOER auction.

 

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June 2013 SRECTrade Auction Results

Posted June 14th, 2013 by SRECTrade.

SRECTrade’s June 2013 SREC Auction closed on 6/04/13. Below are the clearing prices by vintage across the markets covered in the auction.

June SREC Prices SREC Vintage Year
State 2011 2012 2013*
Delaware – $35.00 –
Maryland $107.00
 $115.00 $122.50
Massachusetts – $215.00 –
New Jersey $115.00 $125.00 $130.00
Ohio In-State – – –
Ohio Out-of-State $14.00 $14.00 $14.00
Pennsylvania – $10.00 $11.00
Washington, DC – – $488.98

Notes:
*Delaware, New Jersey and Pennsylvania operate on a June-May energy year. For example, current vintage SRECs are generated beginning in June of 2012.
Green text represents a price increase over the last auction clearing price for that vintage, red text represents a decrease. “-” reflects no sale, which would result if there were no SRECs available for sale in that vintage or there were no matching bids and offers to determine a clearing price.

State Market Observations:

Delaware: Current vintage DE SRECs traded at $35/SREC. The primary buyer for DE SRECs is Delmarva Power and Light (DPL). Most SRECs are sold through DPL’s SRECDelaware program, for which SREC asset owners submit competitive applications in order to obtain 20 year SREC contracts. There continues to be some need for SRECs outside of DPL’s program and compliance buyers with a need for DE sited but non-DPL derived demand will decline over time. SRECTrade administers both the DPL spot auction as well as the software behind the the SRECDelaware solicitations.

Maryland: MD eligible SREC prices came down again from last month’s SRECTrade auction prices. MD2011s, MD2012s, and MD2013s  transacted at $107.00/SREC, $115.00/SREC, and $122.50/SREC, respectively, in the June auction.

Massachusetts: The MA2012 auction price increased from $200/SREC in May to $215/SREC in the June auction. Unsold SRECs need to be deposited in the DOER Solar Credit Clearinghouse Auction NEPOOL-GIS account by June 15, 2013. SRECs that are not deposited in the DOER auction will not be eligible for future transactions. SRECTrade expects that approximately 45,000 SRECs will be deposited in the DOER auction. For the latest info on the MA market read our MA blog posts.

New Jersey: NJ SREC prices declined in the June auction.  NJ2011,  NJ2012, and NJ2013 SRECs traded at $115.00, $125.00, and $130.00/SREC, respectively. The New Jersey market remains over-supplied. Excluding unsold SREC supply carried over from previous vintages, approximately 496.7 MW of annual installed operational capacity  is required to meet the 2013 requirement. As of, 5/31/2013, the NJ Office of Clean Energy reported that 1,078.4 MW had been installed in NJ.

Ohio: No transaction occurred for OH sited SRECs this auction period. OH2011, 2012 and 2013 adjacent vintage SRECs traded at $14/SREC. 2013 is expected to continue to experience oversupply and minimal demand. Most demand for OH Sited SRECs has been fulfilled through long term agreements with large utility scale projects or through long term RFPs with the state’s regulated utilities.

Pennsylvania: PA2012 and 2013 SRECs traded at $10/SREC respectively, in line with previous auctions. SREC oversupply will continue to lead depressed SREC pricing for the foreseeable future. 

Washington, DC: DC SRECs continue to increase in value. DC 2013 vintage SRECs traded at $488.98. It is expected the market will continue to experience under supply into the 2013 trading year.

For historical auction pricing please see this link. The next SRECTrade auction closes on Tuesday, July 2nd at 5 p.m. ET and will cover PJM  SRECs only. Click here to sign in and place an order.

Any unsold MA 2012 SRECs should be deposited in the the DOER auction NEPOOL-GIS account by June 15th. SRECTrade will automatically transfer unsold MA SRECs for its EasyREC clients. This June 15th deadline only affects facilities that are sited in MA and eligible for the MA SREC program.

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SRECTrade SREC Markets Reports: May 2013

Posted June 13th, 2013 by SRECTrade.

SRECTrade SREC Markets Report: May 2013

The following post is a monthly update outlining the megawatts of solar capacity certified to create SRECs in the Solar REC markets SRECTrade serves. All PJM data is based on the information available in PJM GATS as of the date noted. All MA data is based on the information provided by the DOER as of the date noted. This analysis does not include projects that are not yet registered and certified with the entities noted herein.

A PDF copy of this table can be found here.

 Capacity_May2013

Overview of PJM Eligible Systems

As of June 10, 2013 there were 35,136 solar PV and 706 solar thermal systems registered and eligible to create SRECs in the PJM Generation Attribute Tracking System (GATS). Of these, 238 (0.66%) have a nameplate capacity of 1 megawatt or greater. Twenty-five of these projects have a nameplate capacity of 5 MW or greater. New Jersey continues to host most of the larger scale facilities, claiming home to 60.0% of the projects, 15 of 25 facilities, that are equal to or greater than 5 MW. Unchanged from the last couple of months, the three largest projects are a 29.1 MW FirstSolar project in MD, the 25.1 MW PSE&G utility pole mount project located in NJ, and the 16.1 MW Mount St. Mary’s project in MD.

NJ Office of Clean Energy Estimated Installed Capacity Through 5/31/13: On June 11, 2013, the New Jersey Office of Clean Energy announced that total installed solar capacity reached 1,078.4 MW; an increase of approximately 29.3 MW over April’s total capacity.

Massachusetts DOER Qualified Projects

As of May 20, 2013, there were 5,992 MA DOER qualified solar projects; 5,897 operational and 95 not operational. Total qualified capacity is 287.0 MW; 217.9 MW of which is operational and 69.1 MW not operational. As of June 7, 2013, the MA DOER published a new RPS Solar Carve-Out list demonstrating the projects that are currently under review for a statement of qualification under the current solar carve-out program. Under the original 400 MW cap, there are 305 projects (237 operational and 68 not operational) qualified totaling 115 MW (3.4 operational and 111.6 not operational). Additionally, the DOER report provided information about projects that fall outside of the original 400 MW cap. There are 1,323 projects (456 operational and 867 not operational) totaling 504.3 MW (7.2 operational and 497.1 not operational) on this section of the list. Based on the information presented at the MA DOER Stakeholder meeting on Friday, June 7, 2013, some of these projects may qualify as eligible under the emergency regulations to be implemented.

How to Interpret This Table

The tables above demonstrate the capacity breakout by state. Note, that for all PJM GATS registered projects, each state includes all projects certified to sell into that state. State RPS programs that allow for systems sited in other states to participate have been broken up by systems sited in-state and out-of-state. Additional detail has been provided to demonstrate the total capacity of systems only certified for one specific state market versus being certified for multiple state markets. For example, PA includes projects only certified to sell into the PA SREC market, broken out by in-state and out-of-state systems, as well as projects that are also certified to sell into PA and Other State markets broken out by in state and out of state systems (i.e. OH, DC, MD, DE, NJ). PA Out-of-State includes systems sited in states with their own state SREC market (i.e. DE) as well as systems sited in states that have no SREC market (i.e. VA). Also, it is important to note that the Current Capacity represents the total megawatts eligible to produce and sell SRECs as of the noted date, while the Estimated Required Capacity – Current and Next Reporting Year represents the estimated number of MW that need to be online on average throughout the reporting period to meet the RPS requirement within each state with only that particular compliance period vintage. For example, New Jersey needed approximately 496.7 MW online for the entire 2013 reporting year to meet the RPS requirement with 2013 vintage SRECs only. SRECs still available from prior eligible periods can also impact the Solar RPS requirements. Additionally, the data presented above does not include projects that are in the pipeline or currently going through the registration process in each state program. This data represents specifically the projects that have been approved for the corresponding state SREC markets as of the dates noted.

Note: SREC requirements for markets without fixed SREC targets have been forecast based on EIA Report “Retail Sales of Electricity by State by Provider” updated 10/1/12. Projected SRECs required utilizes the most recent EIA electricity data applying an average 1.5% growth rate per forecast year. The state’s RPS Solar requirement is then multiplied by forecast total electricity sales to arrive at projected SRECs required. Projected capacity required is based on a factor of 1,200 MWh in PJM states and 1,130 MWh in MA, generated per MW of installed capacity per year.

 

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Massachusetts DOER 400 MW Cap Stakeholder Meeting

Posted June 7th, 2013 by SRECTrade.

Today, the DOER hosted a meeting to address how the current SREC program will be finalized and the implementation of a the state’s next SREC program. The MA SREC market was thrown a curve ball last week when the DOER announced on May 29th that the current SREC program had reached its 400 MW capacity. Many industry participates expected the program to be closed to applicants sometime in 2014. In fact, the DOER planned to announce on June 7th, a process for applicants to ensure project eligibility under the current 400 MW SREC program.

The meeting today outlined the criteria for managing projects that are installed but not listed as eligible under the original application guidelines for the current program and those projects that have applied but are not yet installed.

In addition to today’s meeting, the DOER promulgated rule changes proposed in February of this year (see blog post here). The details of the implemented rules can be found on the DOER’s website here.

Clarifications on project eligibility for the current SREC program

The DOER plans to enact emergency rules for the current 400 MW Solar Carve-out program. The initial outline of those rules are listed below and additional details can be found here on the DOER’s website. A link to the presentation slides from today’s meeting can be found here. We will update updates on these rules as the DOER provides further official clarification.

The DOER is expanding the current program capacity limit to include project applications that meet certain criteria. To do this this they are splitting applications up into two categories based on facility size: 1) projects equal to or less than 100 kW and 2) projects greater than 100 kW.

Projects equal to or less than 100 kW

  • Applications for facilities equal to or less than 100 kW which have an authorization to interconnect approval and have submitted an SQA prior to the effective date of MA’s next solar carve-out program will be provided an SQA. We believe the effective date will be 1/1/2014 at the earliest, but look to the DOER to provide further clarification.

Projects greater than 100 kW

  • Projects that are listed after the 400 MW capacity cap demarcation on the pending SQA list will qualify if they they meet the following criteria: 
    • Fully executed Interconnection Service Agreement (ISA) application dated June 7, 2013 or earlier.
    • Receive an authorization to interconnect by 12/31/2013, or an extension to 6/30/2014 can be applied for if at least 50% of the project budget is spent by 12/31/2013.
    • Projects that can demonstrate interconnection applications have been delayed by the distribution utility can request further extensions. 

Clarifications on the next SREC program

The DOER indicated that the next phase of the Massachusetts SREC market will be a modification of the current program. The Commonwealth has an overall goal of 1,600 MW of installed solar capacity under the current SREC program and the future SREC program. The final size of the next SREC program will be determined by how many facilities meet the criteria for eligibility outlined above for the current program. For example if 500 MW of capacity is approved in the current program, then the next SREC program will allow for 1,100 MW of eligible capacity. The DOER emphasized that the next program’s design will take in to account a goal to minimize the impact of the program on rate rate payers and eventually bring the SREC market in line with the Massachusetts Class I REC market.

To do this the DOER plans to implement a series of key design features based on project location, size, and a new tool that the DOER calls the Adjusted SREC factor. Smaller projects will be granted SRECs that carry an inherently higher value than larger projects. Additionally, it was proposed that a greater SREC factor will be given to projects installed on brownfields and other specially designed zones. The DOER intends to adjust the SREC factor over time for projects as more capacity comes to market and the cost to install decreases.

The DOER also intends to moderate growth by capping the capacity for eligible project applications on a year to year basis using managed growth provisions to throttle supply.

The DOER mentioned that a separate, but similar Solar Credit Clearinghouse Auction will provide a price support mechanism. All projects will have a 10 year opt-in term. The price set under this mechanism was not mentioned. The DOER did indicate that it is waiting for the legislature to determine the outcome of H2915, a bill that if passed, would require the distribution utilities to support a minimum SREC price in years where there is an over-supply of SRECs.

Preliminary SACP prices were presented as well. The SACP is the penalty price that electricity suppliers in the MA market must pay if they do not meet their renewable energy compliance requirement with SRECs. The proposed schedule is listed below:

2014: $375
2015: $350
2016 (and beyond): $325

We look to the DOER to continue to clarify the application rules for the current SREC program as well as the general market design and implementation period for the next SREC program. We express some concern over the administrative complexities presented by the proposed SREC II program. It is important that the DOER and stakeholders understand that however the new program is structured, participants should focus on pursuing administrative efficiency in transacting SRECs and managing solar assets. SRECTrade will stay in close touch with the DOER and continue to provide updates on this blog.

 

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Massachusetts 400 MW Cap Update

Posted June 3rd, 2013 by SRECTrade.

DOER to file emergency regulation

On Monday evening (6/3/2013) the DOER sent out a second email updating stakeholders on the situation surrounding the state’s solar requirements surpassing the current 400 MW goal. The email included a link to the latest data on the status of projects’ applications for the 400 MW Solar Carve-out. Additionally, the statement noted the DOER’s intentions to file emergency regulation sometime this month. Details on the emergency regulation proposal will be provided at a stakeholder meeting this Friday, June 7th. In addition to the emergency regulation, the meeting will cover the status of the post 400 MW solar program.

400 MW Solar Carve-out filled with non-operational project applications

On May 29th SRECTrade reported on an email from the Massachusetts DOER stating that the Massachusetts SREC market had reached the 400 MW goal. This came on the heels of a May 20, 2013 qualified projects list released by the DOER that showed only 287 MW of qualified capacity registered, which left room for 113 MW of new qualified capacity. Of the 287 MW capacity, 69.1 MW was listed as non-operational. However, the Pending SQAs list made public today shows that an additional 110.8 MW of non-operational projects were listed as qualified or administratively complete by the DOER between the issuance of the 2 reports. In total 179.9 MW or 45% of the qualified or administratively complete solar capacity is currently listed as non-operational.

SRECTrade to attend the DOER’s stakeholder meeting on June 7th

SRECTrade continues to closely monitor events and will have a representative at the DOER’s stakeholder meeting on Friday, June 7th. We will provide any relevant updates as they become available.

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