Archive for the ‘State RPS’ Category

Massachusetts Solar Carve-out Proposed Rule Changes Released

Posted February 28th, 2013 by SRECTrade.

On 2/27/2013 the Massachusetts Department of Energy Resources (DOER) released proposed changes to the RPS Solar Carve-Out program. The change-tracked version of the proposed rules can be viewed here. Interested parties can submit comments to DOER.SREC@state.ma.us with the word COMMENTS in the subject line from March 1st until 5:00 PM on March 25th. A public hearing will be held on March 22nd in the Gardner Auditorium, Massachusetts State House in Boston from 1:00pm to 3:00pm.

The proposed changes to the rules fall into two general categories: 1) updates to the existing program and 2) changes to smooth the approach to the 400MW program cap. The following is a brief summary of the proposed changes:

Change to allow anyone to deposit an SREC in the Clearinghouse Auction, not just the original SREC owner.
Clarification that reminted SRECs coming out of a Clearinghouse Auction can’t be submitted to any future auctions.
Direction to the DOER to develop an assurance process that will allow proposed systems a spot under the 400MW limit as long as they follow certain steps. This will probably be very similar to the net metering process that was recently enacted.
Details were provided on the conditions necessary for a rebuilt system to qualify as new.
A change was made to the formula used to determine each year’s SREC requirement, removing the “SACP volume” portion of the formula. In the original rule, the next years’ standard was adjusted by subtracting SACPs paid in the two years prior. The formula change would be retroactive to 2013, although there is protection for electric distribution companies with existing contracts. It also includes a novel mechanism by the DOER to purchase a like number of SRECs protected under this clause so that there will be no impact on total demand from the sheltering of existing contracts. Click here for a more comprehensive explanation of this formula adjustment.
Some minor changes were made to the calculation used to determine annual SREC requirements after reaching 400MW using the existing base to determine the capacity factor rather than the calculated number used before. Also minor changes on what happens the last year of the program if SRECs are entered into the auction that year.

For more specific details on these changes and their impact on the MA SREC market, feel free to email or call us at SRECTrade.

Tags: DOER, Massachusetts Solar Carve-out
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Massachusetts 10 Year Opt-in Term Deadline

Posted February 6th, 2013 by SRECTrade.

Summary
The opt-in term for MA systems will likely be reset to 8 years for systems that submit their information to the DOER after June 20th. SRECTrade customers should submit the complete system information for any new systems prior to June 1st to ensure that SRECTrade can process them and correct any errors prior to the June 20th deadline. Existing systems which are already qualified or have submitted their complete information will not be subject to any change in their opt-in term and do not need to take any action at this time.

Details
There have been a number of questions recently submitted by astute readers of the MA solar carve-out rules about the potential for reduction in the opt-in term. One of the features of the MA solar carve-out is a dynamic opt-in term that expands and contracts based on the over or under supply of SRECs each year. The opt-in term is the length of time that a generation unit is eligible to participate in the Solar Credit Clearinghouse Auction, typically referred to as the last chance auction, run by the MA Department of Energy Resources. The opt-in term was originally set to 40 quarters (10 years), and is increased or decreased by four quarters for each full 10% of the compliance obligation that is deposited into the last chance auction. However, it can only change by a maximum of 8 quarters per year, and can never go below 5 years or above 10 years. This system is designed to make solar installation less attractive in an over-build and more attractive in an under-build scenario, hopefully avoiding the significant volatility seen in other state SREC markets.

Each system is assigned an opt-in term at the time it receives its statement of qualification. The term commences the earlier of the RPS Effective date (the date a system is turned on or receives interconnection, whichever is later) or the first day of the next calendar quarter from the date of qualification. Once a system is assigned an opt-in term, it keeps that term for the life of the system. Any changes to the opt-in term only impact new systems going forward.

The opt-in term has remained at 10 years because no SRECs were deposited in the last chance auction last year. However, based on the installed base of systems in MA in 2012, SRECTrade calculates that approximately 50,000 more SRECs were produced than the 73,400 needed under the RPS. This will trigger a maximum 8 quarter reduction in the opt-in term. Systems can receive qualification prior to interconnection if a completed application is submitted to the DOER by June 20th. Submitting an application to the DOER prior to June 20th will allow the system to receive the current 10 year opt-in term. The applications will need to include all system information, however the system information can be updated with the final build specs when the interconnection letter is submitted. We recommend that all SRECTrade customers have their full application in to SRECTrade by June 1st, to allow us to check for any missing information and ensure the completed application is submitted by the June 20th deadline.

For more information on the Massachusetts 10 year opt-in deadline please visit the Massachusetts Department of Energy Resources Statement of Qualification page.

Update, 2/25/2013, per an email from the DOER, systems greater than 1 MW must prove that they have received all applicable state and local permits (if they have not yet received interconnection) in order to qualify for the 10 year opt-in prior to June 20th.

Tags: DOER, Last Chance Auction, MA, Opt-In Term, SRECs
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MA Gov. Deval Patrick Signs Law Adjusting Net Metering Cap

Posted August 30th, 2012 by SRECTrade.

Massachusetts Bill SB 2395, “Relative to Competitively Priced Electricity in the Commonwealth,” was signed into law on August 3, 2012 by Governor Deval Patrick. The new legislation clarifies some issues related to meeting the Massachusetts Renewable Portfolio Standard (RPS) goal of 22.1% by 2020. Its purpose is to further bolster the existing RPS goals by: 1) increasing the net metering cap; 2) expanding requirements for the EDC long-term contract program and 3) limits entities from owning more than 25 MW of solar. *Please see note below. While this legislation does not explicitly impact the solar carve out portion of the Massachusetts RPS, it does impact net metering policy in MA, a key facet of solar project development. By raising the net metering cap, there is now more room for the development of solar projects at any scale. If development continues to exceed the yearly capacity goals set aside by the DOER, then SREC prices should remain suppressed relative to the SACP.

The legislation doubles the net metering cap to 6%, with 3% allocated for public and private projects each. As Massachusetts was already close to the 3% net metering cap, the bill was essential to ensure renewable energy project development of all types throughout the rest of the year. In addition to the increase in the cap, the bill also states that Class I facilities that are less than 10 kW (single-phase) and <25 kW (3-phase) in capacity will be exempt from the net metering cap altogether. The <10 kW/ 25 kW Class I REC exemption ensures that developers of residential and small commercial facilities will not need to take in to consideration the net metering cap. Class I RECs include RECs produced from most renewable energy technologies (solar, wind, tidal, biomass etc.) that were operational after December 31, 1997. (Source: DSIRE)

*A previous version of this post included language about a property tax exemption for qualified renewable energy facilities. The property tax exemption portion of SB 2395 was not included in the final bill.

Tags: Net Metering, net metering cap, SB 2395
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Last minute push to revive Pennsylvania HB 1580

Posted May 21st, 2012 by SRECTrade.

**Update: As of this writing (Tuesday, June 12th) HB 1580 has not gone up for vote. However, the PA legislator extended the legislation session through the end of June, allowing for some hope that with enough grassroots pressure from supporters of the PA solar industry the bill will go up for vote. PASEIA encourages supporters of HB 1580 to continue to call into the offices of the PA House leadership. The applicable phone numbers are listed below.

A coalition of solar industry groups led by PASEIA, SEIA, PennFuture and Vote Solar are making one last push to revive Pennsylvania House Bill (HB) 1580 before the close of the work week on Friday, 5/25. HB 1580 was first introduced in October 2011 by Rep. Chris Ross (R-Chester) as a fix for what many in the PA solar industry view as an SREC market with prices trading at unsustainable levels. The bill’s core proposal is to move forward the Pennsylvania SREC requirement by three years – effectively accelerating SREC requirements in an attempt to stabilize the market. A hearing was held in the Pennsylvania House Consumer Affairs Committee in January 2012 and 108 (enough to pass the bill in the House) committed to vote for the bill if it passed out of committee. Lobbyists were also able to garner a substantial amount of support in the Senate.

Why hasn’t the bill passed yet?

Despite the January hearing on HB 1580 the bill was never put up for vote in the House Consumer Affairs Committee. The decision to do so is the responsibility of Committee Chair Rep. Bob Godshall (R-Montgomery) who has taken counsel from stakeholders both for and against the bill. The coalition of groups supporting HB 1580 emphasize in their communication with stakeholders that HB 1580 is meant to provide support for jobs created by the nascent Pennsylvania solar industry at little to no additional cost to ratepayers. However, the Pennsylvania Chamber of Commerce along along with other groups representing natural gas and other interests are opposed to the bill. Furthermore, strong pressure for and against the bill has made it a tough topic to address amid the latest election cycle.

Another push

Pennsylvania stakeholders that support HB 1580 have the option to lobby key members of the Pennsylvania legislator to get the bill put up for vote. HB 1580 advocates are encouraged to call the following three members of the PA House leadership.

Rep. Robert Godshall (Committee Chair): 717-783-6428
Rep. Samuel Smith (Speaker of the House): 814-938-4225
Rep. Mike Turzai (House Majority Leader): 412-369-2230

Tags: HB 1580, legislation, Over-supply, SRECs
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Delaware Pilot SREC Procurement Program

Posted March 30th, 2012 by SRECTrade.

SRECTrade was recently awarded the contract to administer the Delaware Pilot SREC Procurement Program on behalf of the Delaware Sustainable Energy Utility (SEU) and Delmarva Power. Since receiving the contract we’ve put up a website to answer questions about the program and to accept applications for the solicitation. An overview powerpoint and webinar recording can be viewed by clicking here.

This is the first essentially state-wide SREC program to take such a long-term approach to SREC contracts. Regulators and industry observers are eager to see how this “pilot” solicitation is reviewed. Should the “pilot” be deemed successful it is likely that the SEU will hold yearly solicitations for SREC contracts.

With the Pilot SREC Procurement Program, the SEU and Delmarva have formed a partnership to provide stable, long-term pricing (20-year contracts) for a finite amount of SRECs from systems that are accepted into the program. Among the eligible systems for the program, preferential selection and pricing is given to systems installed with Delaware parts and/or labor. Systems under 250 kW (DC) nameplate capacity apply into a lottery solicitation, whereas systems that are greater than 250 kW (DC) must apply through a competitive bid process. The solicitation will likely be over-subscribed with applications from among the many eligible, in-state systems. Solar systems that are not successful in the solicitation will still be able to transact SRECs outside of the Delmarva program, and could remain eligible for future solicitations or this program.

Key items

DE-sited solar systems interconnected on or after 12/1/2010 are eligible.

Systems must have online monitoring.

Systems that received funding from a public source other than the Federal Investment Tax Credit and DE Green Energy Program are ineligible.

4/2/2012 – Solicitation opens.

4/6/2012 – Solicitation will stay open at least until this date for systems <250 kW (DC) capacity, but could stay open if not all capacity is filled.

4/13/2012- Solicitation closes for systems >250 kW (DC).

4/23/2012 – Results announced.

Tags: Contract, Contracts, Delaware, Long-term, Pilot, procurement, RPS, SRECs
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Pennsylvania Solar Bill Goes to Committee

Posted January 17th, 2012 by SRECTrade.

On Wednesday, 1/11/12, Pennsylvania House Bill (HB) 1580 sponsored by Rep. Chris Ross (R-Chester) was presented to the House Consumer Affairs Committee for debate. HB 1580 is a proposal to move forward the Pennsylvania SREC requirement to the current compliance requirement for 2015 without changing the overall number of SRECs required after 2015. This would alleviate the over-supply of SRECs and increase the value of Pennsylvania SRECs. While the hearing was a critical first step for HB 1580, followers of the Pennsylvania solar industry will have to wait on the Consumer Affairs Committee’s vote before the fate of the bill is known. Should the bill make it out of committee it will also need to pass the House and Senate where both the House and Senate have voiced initial majority support for bill.

During the hearing solar industry representatives and solar consumers testified in support of the bill while utility groups and the Pennsylvania Chamber of Business spoke against it. The PA Environment Digest put together a detailed account of the testimonies. Generally those in support of the bill argue: 1) that the bill is essential for maintaining highly skilled solar jobs in Pennsylvania; 2) doesn’t increase the overall requirement for SRECs; 3)merely accelerates the requirement and 4) brings Pennsylvania’s SREC market more in line with the design of other SREC markets by closing the market to out-of-state sited systems (currently PA accepts SRECs from anywhere in the PJM region i.e most states in the mid-Atlantic and some states in the Midwest). Utility companies that testified against the bill argue that it would place an undue burden on rate payers by forcing utilities to charge more for the electricity that they supply. According to the PA Environment Digest article, there was some disagreement over the actual cost of the bill to rate payers, but on the high side utilities estimate that it would be an increase of $120 million over four years to four million Pennsylvania rate payers, which equates to an increase of about $3.33 per year to each rate payer.

SRECTrade will continue to closely monitor the development of HB 1580. Stay tuned to our blog for updates.

Tags: HB 1580, legislation, Over-supply, Pennsylvania SREC
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Pennsylvania House Bill 1580 Update

Posted January 9th, 2012 by SRECTrade.

House Bill (HB) 1580 will go before The Pennsylvania Commerce Committee on Wednesday, 1/11/12. This is the third date that has been scheduled for the committee hearing. HB 1580 is a proposal to accellerate the Pennsylvania SREC requirement by three years from 2013 to 2015. If the Bill passes committee on Wednesday then it will also need approval by the House and Senate. Currently the House is majority in favor of the current bill and the Senate looks to be in favor of passing a similar version should the House come to a resolution. SRECTrade will post a blog update once we get word on the Commerce Committee decision.

Posted in Pennsylvania, SREC Markets, State RPS | 1 Comment »

Governor Christie backs solar in New Jersey’s final 2011 Energy Master Plan (EMP)

Posted December 7th, 2011 by SRECTrade.

Governor Christie’s administration has released the 2011 Energy Master Plan, which can be viewed in its entirety here. The Plan is generally positive for the stability of NJ SREC markets, and signals overall support by the Governor’s Office for solar in NJ. The plan specifically lists support for the following:

1. Accelerate the RPS:

A temporary acceleration of the RPS would provide some interim relief for the current market in SRECs and an opportunity for the industry to adjust. This acceleration would require increasing the RPS over the next three years and reducing the outlier years of the RPS schedule to minimize the impact to ratepayers.”

and

2. Give preference to smaller, distributed projects:

Projects that offer a “dual benefit” should take priority for approval and any legislative expansion of SREC eligibility by modifying the definition of “distribution system” should also provide the BPU with the ability to review and approve subsidies for grid-supply projects to ensure compatibility with land use, environmental and energy policies. Additionally, the development of solar projects should not impact the preservation of open space and farmland.

We read that second bullet as support for giving the BPU the ability to manage large utility scale projects so that they don’t flood the SREC market.

Other interesting points include support for extending Electric Distribution Company contracting programs and support for a requirement to set up a supply queue that will give the market insight into pipeline of future non-residential systems.

The Governor also calls for reducing the Solar Alternative Compliance Payment (SACP) schedule to minimize impact of the previous changes to ratepayers. This seems to be a reasonable concession on the part of SREC sellers, especially given that the current oversupply situation makes the SACP irrelevant.

The EMP by itself does not make policy or change the current NJ renewable portfolio standard. However, it does signal the Governor’s position on any legislation that he may be asked to sign that would change the portfolio standard law, like Assembly Bill 4226 which contains many of the items listed in the EMP.

The EMP process itself has been illuminating, revealing a Governor’s office that is responsive to stakeholder input and seems to be responsive to data over dogma. The draft EMP released earlier in the year was far less positive toward solar, however over several public meetings and hundreds of public comments the Governor’s office heard a great deal about the impact of solar on jobs and NJ’s energy supply. The final Plan reflects much of this input and is a very different document from the draft.

Overall, the 2011 EMP indicates that the Governor supports solar, but he isn’t willing to write the industry a blank check. The solar industry will need to continue to prove it’s value to New Jersey, and as long as it continues to do so it appears to have the support of Governor Christie.

 Accelerate the RPS

A temporary acceleration of the RPS would provide some interim relief for the current market in

SRECs and an opportunity for the industry to adjust. This acceleration would require increasing

the RPS over the next three years and reducing the outlier years of the RPS schedule to minimize

the impact to ratepayers.

Tags: New Jersey, New Jersey SREC, New Jersey SRECs, NJ SREC, NJ SRECs, Solar, solar legislation, SREC Market
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PSEIA: HB1580 creates thousands of jobs for less than half a penny a day

Posted November 23rd, 2011 by SRECTrade.

On November 16^th, 2011, the Pennsylvania Solar Energy Industries Association (PASEIA) released its Ratepayer Cost Analysis regarding PA House Bill #1580. HB1580 was introduced on October 3^rd, 2011 by Rep. Chris Ross, and includes 109 co-sponsors as of November 10^th, 2011.

The Bill was introduced to address the recent collapse of the PA SREC market by accelerating the solar share requirement from 2012 through 2015. While the solar share requirements from 2012 through 2015 have been accelerated, the solar share requirements in 2016 through 2018 remains the same as SREC prices are expected to have stabilized by then regardless of the present situation. HB1580 will also close the solar market in Pennsylvania to out-of-state systems, thus limiting the supply of SRECs available which will drive up their value. While undoubtedly a blessing for the solar industry within Pennsylvania, some concerns have been raised regarding the impact this program will have on ratepayers. The Ratepayer Cost Analysis aims to address these issues.

Here is the breakdown of HB1580, using figures derived from the Cost Impact Report. The introduction of HB1580 imposes an additional $113,315,417 distributed amongst all residential and commercial power users in Pennsylvania.

Current Scenario
Reporting Year	Solar Share	SRECs	SREC Price*	Cost
2012 – 2013	0.0510%	75,189	$50	$3,759,453
2013 – 2014	0.0840%	123,012	$50	$6,250,621
2014 – 2015	0.1440%	216,338	$50	$10,816,879
2015 – 2016	0.2500%	379,150	$70	$26,540,513
2016 – 2017	0.2933%	449,047	$80	$35,923,723
2017 – 2018	0.3400%	525,500	$85	$44,667,471
Total	–	1,770,235	–	$127,958,661

Proposed Scenario (HB1850)
Reporting Year	Solar Share	SRECs	SREC Price*	Cost	Increment
2012 – 2013	0.1500%	221,144	$190	$42,017,420	$38,257,967
2013 – 2014	0.1700%	253,001	$150	$37,950,200	$31,699,579
2014 – 2015	0.2040%	306,478	$125	$38,309,780	$27,492,901
2015 – 2016	0.2500%	379,150	$100	$37,915,019	$11,374,506
2016 – 2017	0.2933%	449,047	$90	$40,414,188	$4,490,465
2017 – 2018	0.3400%	525,500	$85	$44,667,471	$0
Total	–	2,134,320	–	$241,274,078	$113,315,417

* SREC price is based on aggregator feedback, as well as average weighted PA SREC prices in GATS

The cost imposed on each ratepayer is than calculated based on an estimated use of 10,716kWh/yr for residential and 150,000kWh/yr for commercial usage.

Reporting Year	Estimated Elect Sales	Estimated Increased Cost	Cost Increase per kWh	Estimated Increased Residential Cost		Estimated Increased Commercial Cost
Reporting Year	Estimated Elect Sales	Estimated Increased Cost	Cost Increase per kWh	Annual	Monthly	Annual	Monthly
2013	147,429,544	$38,257,967	$0.0002595	$2.78	$0.23	$38.93	$3.24
2014	148,824,315	$31,699,579	$0.0002130	$2.28	$0.19	$31.95	$2.66
2015	150,234,430	$27,492,901	$0.0001830	$1.96	$0.16	$27.45	$2.29
2016	151,660,076	$11,374,506	$0.0000750	$0.80	$0.07	$11.25	$0.94
2017	153,101,443	$4,490,465	$0.0000293	$0.31	$0.03	$4.40	$0.37
2018	154,558,725	$0	$0	–	–	–	–
Total		$113,315,417	–	$8.14	$0.68	$113.97	$9.50
Average		–	$0.0001520	$1.63	$0.14	$22.79	$1.90

As the table shows, the residential bill on average increases by less than 14 cents over five years and under $2 for commercial customers with an assumed annual electric usage of 150,000kWh/yr. This amounts to less than half a penny a day for residential owners. In addition, these are pre-tax costs, so for-profit commercial and industrial customers will pay less than these estimates based on their effective tax rates..

For more information, please contact:

Ron Celentano

PASEIA – President

CelentanoR@aol.com

Tags: Chris Ross, Cost Analysis, HB 1580, HB1580, PA, Pennsylvania, Pennsylvania Solar energy industries association, PSEIA, Ratepayer
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PA Market Update

Posted July 28th, 2011 by SRECTrade.

The Pennsylvania 2011 SREC compliance year has seen a substantial amount of solar development. Solar capacity registered within the state has lead to a significant oversupply resulting in an 85% decline in spot market trading throughout the course of the 2011 reporting year.

Since September of 2010, PA SRECs have dropped from $300/SREC to $50/SREC. As of July 25, 2011, the 115.7 MW of registered generation has far outpaced the 2011 RPS requirements of 18 MW. This has been the result of additional PA solar incentives, on top of the SREC program, and a large influx of out-of-state systems; of the 115.7 MW registered in PA, 24.7 MW are located out-of-state.

Fortunately, Representative Chris Ross has proposed an amendment to the PA Alternative Energy Portfolio Standard. The amendment would modify the eligibility criteria so that only in-state systems could register in Pennsylvania after January 1, 2012. Furthermore, the solar carve-out requirements for energy years 2013, 2014, and 2015 would increase from approximately 71 MW, 118 MW and 205 MW to 207 MW, 238 MW, and 290 MW, respectively. These proposed changes should strengthen the market by increasing solar requirements and closing off out of state supply. However, the oversupply of SRECs in 2011 and 2012 will carry over into the 2013 solar year and may keep prices low. Given the legislature is out of session until October, further development will not occur until late 2011.

If new legislation does get passed, the market may shift from an oversupplied market to an undersupplied market. This shift could result in an increase in future SREC pricing. One of the determining factors for price is the Alternative Compliance Payment (ACP). In some states, NJ for example, the ACP is set by law and is known for future years. Buyers know exactly what the alternative payment will be, and thus have a basis for the maximum value of an SREC. In PA however, the future ACP is not known. The ACP is calculated based on the average price paid for an SREC during the current year with weighting to include solar rebates. For Chris Ross’s amendment to be truly successful, it will not only have to address the oversupply, but the ACP price as well.

To get involved with advocating for solar legislation, the Pennsylvania Division of the Mid-Atlantic Energy Industries Association (PASEIA) is a group of solar professionals who advocate for the interests of solar energy and a strong local PA industry. Their blog has some good information on the status of the bill.

PA SREC Market – Proposed Legislation and Current Capacity

Note: Capacity (MW) forecast based on PA RPS requirements and SRECTrade estimates. Capacity (MW) figures presented for May 2010, May 2011, and July 2011 based on registered systems in GATS as of date listed. The current requirements (i.e. green line) as of July 2011 demonstrates the capacity (MW) required for the 2012 reporting year; approximately 44 MW. Figures for 2013-2015 represent the estimated amount of installed capacity (MW) needed on average throughout the compliance year.

Tags: House Bill 1580, PA SREC, PA SRECs, SACP, selling SRECs, Solar Renewable Energy Certificates, SREC, SREC Programs, SREC States, SRECs
Posted in Pennsylvania, SREC Markets, SREC Pricing, State RPS | 3 Comments »