Solar Renewable Energy Certificates

In SREC state markets, the Renewable Portfolio Standard (RPS) requires electricity suppliers to secure a portion of their electricity from solar generators. The SREC program provides a means for Solar Renewable Energy Certificates (SRECs) to be created for every megawatt-hour of solar electricity created.

The SREC is sold separately from the electricity and represents the “solar” aspect of the electricity that was produced. The value of an SREC is determined by the market subject to supply and demand constraints. SRECs can be sold to electricity suppliers needing to meet their solar RPS requirement. The market is typically capped by a fine or solar alternative compliance payment (SACP) paid by any electricity suppliers for every SREC they fall short of the requirement.

SREC facts

  • 1 SREC = 1 MWh of solar electricity
  • A 10 kW facility generates around 12 SRECs annually
  • SRECs are sold separately from the electricity
  • Value is determined by market supply and demand mechanics
  • Facilities must be certified by a state to sell SRECs