Create account Log in

CA LCFS Update – February 2020

Posted February 14th, 2020 by SRECTrade.

2020 is proving to be another record-breaking year in the California Low Carbon Fuel Standard (CA LCFS) market. Credit pricing remained strong throughout Q4 2019 and January 2020 with spot pricing sustaining levels over ~$200 per credit. Despite the cost containment provisions the California Air Resources Board (CARB) implemented in late 2019, the market recently has transacted above the implied ~$213 cap. The enclosed update provides highlights on news impacting the market, a recent price trend overview, and a closer look at the Q3 2019 credit and deficit report released by CARB at the end of January.

SRECTrade offers LCFS credit management and brokerage services to electric vehicle (EV) fleet operators, OEMs, EV charging station owners, and other clean fuel asset owners. We help our clients navigate the entire LCFS process including asset registration, ongoing reporting requirements, transacting, settlement, and remittance of funds. Our domain expertise in environmental commodity markets allows us to provide our clients with industry leading regulatory and market knowledge. Please reach out to cleanfuels@srectrade.com for more information.

Posted in Low Carbon Fuel Standard |

Pennsylvania SREC Market Update: What Will the Market Look Like If SB600 Passes?

Posted February 5th, 2020 by SRECTrade.

In November of 2018, the Pennsylvania Department of Environmental Protection (“DEP”) released the Pennsylvania Solar Future Plan. The 152-page document outlines strategies to help the state meet a goal of 10 percent in-state solar electricity generation by 2030. As part of this plan, the DEP recommends that the state consider revising their Alternative Energy Portfolio Standard Program (“AEPS”) and increase the target to help bolster SREC prices and solar build rates. In response, on April 10, 2019, Senate Bill 600 was introduced in the Pennsylvania General Assembly. Most notably, the Bill:

  1. Expands AEPS Tier I requirement from 8% by 2021 to 30% by 2030
  2. Expands AEPS solar carve-out from 0.5% by 2021 to 10% by 2030, including 7.5% for grid-supply solar and 2.5% for distributed generation (DG) solar
  3. Introduces fixed alternative compliance payment (ACP) schedules and a 15-year SREC eligibility term for solar facilities (beginning on June 1, 2021)

While the future of this Bill is still uncertain, SRECTrade has prepared an analysis that illustrates the projected market dynamic if SB600 were to pass as well as baseline scenario cases assuming the current AEPS policy stays in place.

In reaction to these bullish signals from policymakers and the closure of PA borders to out-of-state systems, SREC prices have seen an appreciation in value over the past 12 to 18 months to values around $35-45. SRECTrade will continue to monitor progressions with this Bill and update our clients, partners, and stakeholders accordingly.

 

Posted in Pennsylvania, SREC Markets, State RPS |

New Jersey Governor Murphy Signs SB S-4275, Resolving Transition Incentive “Kink Year” Issue

Posted January 22nd, 2020 by SRECTrade.

On Tuesday, January 21st, New Jersey Governor Phil Murphy signed Assembly Bill 6088 (AB-6088) / Senate Bill 4275 (SB-4275) into law in a victory for New Jersey “Transition Incentive” program stakeholders. A New Jersey Board of Public Utilities (BPU) order last month established that the Transition Incentive program’s structure will feature a factorized, fixed-price, 15-year Transition Renewable Energy Certificate (TREC), but did not finalize the pricing schedule that will be used throughout the program.

SB-4275 helps address a “kink year” component in one of the pricing schedule options by allowing the BPU to increase costs to electricity customers in energy years (EY) 2022-2024, such that the average cost to electricity customers from EY2019-2024 does not exceed a 9% cost cap during EY2019-2021 and a 7% cost cap for EY2022-2024. This cost cap flexibility allows the BPU to set higher TREC prices in the near term while still remaining below the legislated cost cap. Prior to this legislation adding flexibility, the BPU had proposed drastically lower TREC pricing during the first three “kink years” of the program, followed by higher pricing in later years.

For example, the two pricing schedules that the BPU had considered are: 1) a flat 15-year price of $152 and 2) a lower price of $65 for the first three years followed by a higher price of $189 for the last twelve years. The BPU still has not finalized some key aspects of the TREC program, including the final price levels. SRECTrade will continue to monitor the development of the Transition Incentive program and provide updates.

Tags: , , , , ,
Posted in New Jersey, SREC Markets |

CA LCFS Update – December 2019

Posted December 27th, 2019 by SRECTrade.

2019 has proven to be a dynamic year in the California Low Carbon Fuel Standard (CA LCFS) market. The beginning of the year brought the implementation of a new rule making followed by continued growth in a variety of low carbon fuels including Renewable Diesel, Ethanol, Electricity and others. Credit pricing remained strong throughout the year and in Q4 2019 spot pricing experienced sustained levels over ~$200 per credit. The enclosed update provides highlights on news impacting the market, a recent price trend overview, and a closer look at the Q2 2019 credit and deficit report by fuel type. Q3 2019 credit issuance is just around the corner and we look forward to continuing to work with market participants in the new year.

SRECTrade offers LCFS credit management and brokerage services to electric vehicle (EV) fleet operators, OEMs, EV charging station owners, and other clean fuel asset owners. We help our clients navigate the entire LCFS process including asset registration, ongoing reporting requirements, transacting, settlement, and remittance of funds. Our domain expertise in environmental commodity markets allows us to provide our clients with industry leading regulatory and market knowledge. Please reach out to cleanfuels@srectrade.com for more information.

Tags: ,
Posted in Low Carbon Fuel Standard |

New Jersey Board of Public Utilities Approves Solar Transition Incentive Program

Posted December 18th, 2019 by SRECTrade.

On Friday, December 6th, the New Jersey Board of Public Utilities (BPU) issued an order approving a new SREC program to aid in the transition from the current SREC program to the yet-to-be-determined “Successor Incentive” program. This “Transition Incentive” program will feature a factorized, fixed-price, 15-year Transition Renewable Energy Certificate (TREC). All projects that submitted complete SREC Registration Program (SRP) applications after October 29, 2018, but do not reach commercial operation at the time the BPU determines the 5.1% target has been reached, will qualify for TRECs.

The BPU will hold a cost-cap proceeding in early 2020 to finalize the annual value of the fixed-price TREC. Specifically, the BPU will evaluate two pricing scenarios: 1) a flat 15-year price of $152 and 2) a lower price of $65 for the first three years followed by a higher price of $189 for the last twelve years.

The different TREC project types and factorizations are displayed below:

TRECs will have a useful life of two energy years, including the energy year in which they were generated. If a TREC is not issued or sold during its two-year useful life, it will become an NJ Class I REC. The order further clarifies that Transition Incentive projects will be eligible to generate NJ Class I RECs after their 15-year TREC Qualification Life.

The BPU order also directs electric distribution companies to procure a TREC Administrator. Although the exact mechanics for how TRECs will be transacted are still being determined, the TREC Administrator will ultimately purchase all generated TRECs and allocate them to load-serving entities for compliance based on their market share of retail sales.

SRECTrade will continue to monitor the development of the final TREC levels and the Successor Incentive program.

Tags: , , , , , , ,
Posted in New Jersey, SREC Markets |

NJ SREC Market Update: Market Nearing Closure and Transition Program

Posted December 2nd, 2019 by SRECTrade.

The Clean Energy Act, signed by New Jersey Governor Phil Murphy in May 2018, states that new rules and regulations will be adopted to close the NJ SREC program upon attainment of 5.1 percent of the kilowatt-hours sold in the state by solar electric power generators. Based on recent build rates, the NJ SREC market is expected to reach the program’s maximum capacity of 5.1% by mid-2020, at which point, the New Jersey Board of Public Utilities (NJ BPU) will transition the state to a new program. While the NJ BPU released a straw proposal in 2018 on the anticipated market closure, the exact strategy of determining the 5.1% attainment and eventual transition program is yet to be confirmed.

The enclosed analysis further details the implications of this market close and SRECTrade’s estimated market dynamics through 2022. The analysis assumes flat load through 2022 and utilizes a capacity factor of 12.56%, the approximate running average capacity factor across NJ certified solar facilities since 2012. In each depicted build scenario, the market will close to new capacity once 3,460 MW is hit, or on June 1, 2021, whichever occurs first.

On September 6, 2019, the NJ Board of Public Utilities (“BPU”) released a memo that detailed Basic Generation Service Provider (“BGS”) load exemptions in 2019. This exempt load dynamic has an impact on market demand through EY 2023 and is further detailed in the analysis.

Data from the New Jersey Office of Clean Energy (“NJOCE”) shows that solar build rates have increased slightly over the past six months in comparison to the past twelve months, increasing by 3.6% in that time frame. With this data from NJOCE and credit data from GATS, SRECTrade estimates that the market is over-supplied by 7.5% for the 2020 Energy Year. Assuming flat load growth and no drastic increase in build rates, the market will likely become under-supplied in 2021 and 2022.

In line with this market dynamic, NJ SREC pricing has seen an upward trend over the past twelve months. The enclosed analysis further details the current standing as well as future scenarios for the NJ SREC market.

 

Posted in New Jersey, SREC Markets |

SRECTrade Sponsoring Solar Focus 2019

Posted November 18th, 2019 by SRECTrade.

Join SRECTrade and MDV-SEIA at the annual Solar Focus Conference in Baltimore, Maryland on November 20th – 21st. This year’s conference will focus on how the solar industry can continue its recent policy successes.

Solar Focus brings together solar professionals and industry leaders from across the country to share ideas, build partnerships, and envision the future of solar power. In addition to panels, there is a Women in Solar Breakfast, job fair, and many more networking opportunities.

More information on the conference can be found here.

Posted in SREC Markets |

SRECTrade to Present at Charge Expo Symposium in San Diego, CA

Posted September 27th, 2019 by SRECTrade.

On October 2, 2019, Steven Eisenberg, SRECTrade’s Chief Executive Officer, will be presenting during the “Fuel Management & Low Carbon Transportation Technologies” session at the Charge Expo Symposium in San Diego, CA. The session will take place from 10 AM – 12 PM.

Steven will speak about the benefits of the California Low Carbon Fuel Standard (CA LCFS), a market based program that encourages the adoption of low carbon intensive fuels and vehicles. SRECTrade works with participants across the LCFS market, providing credit portfolio management and transaction services to clean fuel fleet operators and other credit generators.

Posted in Low Carbon Fuel Standard |

SRECTrade Sponsoring The 2019 Zero Emission Bus Conference

Posted September 18th, 2019 by SRECTrade.

From September 26th – 27th SRECTrade will be proudly sponsoring the Zero Emission Bus (ZEB) Conference in San Francisco, CA. The conference will center around electric bus knowledge and industry collaboration, as more cities, states and provinces turn toward zero-emission mobility as a key strategy in mitigating climate change. Join us this September in discussing real strategies for the world’s transit innovators and learn more about how to prepare for electrification at scale.

The Conference is hosted by the Center for Transportation and the Environment (CTE). Learn more about the event and register for it here.

SRECTrade works with participants across the California Low Carbon Fuel Standard (CA LCFS) market, providing credit portfolio management and transaction services to clean fuel fleet operators and other credit generators. For more information on our services contact us at cleanfuels@srectrade.com.

Posted in Low Carbon Fuel Standard |

Massachusetts DOER Announces Final 2020 SREC Minimum Standards

Posted September 16th, 2019 by SRECTrade.

On Friday, August 30th, the Massachusetts Department of Energy Resources (DOER) announced the final 2020 SREC-I and SREC-II Compliance Obligations and Minimum Standards. This announcement follows the results of the SREC-I and SREC-II Solar Credit Clearinghouse Auctions. The final announcement differs only slightly from the preliminary announcement in July.

Solar Carve-out (SREC-I)

The DOER has determined that the Final 2020 Compliance Obligation for the SREC-I program will be 748,584 MWh and that the Minimum Standard will be 1.6116%. The 2020 Minimum Standard for load under contracts signed before June 28, 2013 will be 0.9867%. The Determination of the CY 2020 Total Compliance Obligation and Minimum Standard, published by the DOER, outlines how this Minimum Standard was calculated. Both Minimum Standards are slightly lower than their preliminary counterparts, as a result of the updated Solar PV Capacity Factor used to estimate production.

Solar Carve-out II (SREC-II)

The DOER has also calculated the Final 2020 Compliance Obligation and Minimum Standard for the SREC-II program, which are 1,023,737 MWh and 2.2040%, respectively.

In addition, the DOER calculated the 2020 SREC-II Compliance Obligation and Minimum Standard for load under contracts signed after May 8, 2016 as 1,765,527 MWh and 3.8011%, respectively. The final SREC-II baseline Compliance Obligation and Minimum Standard are slightly lower than their preliminary counterparts, primarily due to two reasons:

  1. A reduction in the average capacity factor applied to estimated generation from 13.35% to 13.08% (using nine years of Massachusetts Production Tracking System production data)
  2. An improvement to the SREC-II production estimation formula to account for the loss of partial MWhs left over after a reporting period, since these partial MWhs do not result in the creation of partial SREC-IIs

Tags: , , , ,
Posted in Massachusetts, SREC Markets |

« Older Entries
Newer Entries »
Clients
Markets
About
Legal

© 2024 SRECTrade, Inc. All rights reserved.