Recent public discussion of Maryland’s proposed increase to the state’s RPS requirements, as well as the introduction of the Clean Energy Jobs Act to the Maryland general assembly, has brought widespread attention to the status of Maryland’s environmental commodity markets. Due to this focus we updated our capacity models for Maryland to account for the latest generation data available in GATS.
Our updated MD capacity presentation can be found here.
Through December 2015 (the last reliable month of data due to reporting lag) there was approximately 113,240 SRECs left over from compliance years 2013, 2014 and 2015. This assumes that the 349,917 available 2015 SRECs are put towards the CY15 compliance requirement of 308,419. Assuming that the observed average monthly build rate of 10.9 MW/month continues to hold, we project that 534,776 additional SRECs will be generated in compliance year 2016. Taking together the existing inventory of available prior-year SRECs together with the projected 2016 production, we foresee an oversupply of 216,229 SRECs by the end of 2016.
As we look into future years, the degree of oversupply begins to vary widely depending on the assumptions made regarding monthly build rates. In 2017 we see a range of market conditions between a 42% and 82% oversupply, and in 2018 conditions between a 15% and 77% oversupply. These projections do not take into account the RPS increases currently under legislative review in the Maryland general assembly, as covered in our recent post from February 10th.
We will continue to monitor the state of the Maryland market as more data continues to be made available regarding reported build rates through early 2016. Please reach out to the SRECTrade team with any questions or feedback.
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