SRECs

Solar Renewable Energy Certificates (SRECs) are a mechanism by which owners of solar energy systems can trade “credits” on an open market and reap financial returns in exchange for the renewable energy attributes of their system.

Solar Renewable Energy Credits in Ohio

In 2008, the Ohio legislature passed a state law (SB‐221) that, among other things, required the four investor‐owned electric utilities in Ohio to add solar to their energy‐generation mix, and to increase the amount of energy produced by clean, renewable sources every year. Ohio is one of 29 states with similar policies, called Renewable Portfolio Standards (RPS).

Ohio law SB‐221 addressed wind and other renewable energy sources, but called out a special category for solar. The law specifically promotes solar as a clean energy choice, and establishes a financial penalty for any shortfall on the utilities’ part in meeting their renewable power generation benchmarks. This penalty is called an Alternative Compliance Payment, or ACP, and utilities cannot pass the cost of ACP payments on to ratepayers—they must be paid out of the utility’s earnings.

Renewable Portfolio Standards are seen as an effective, flexible way to spur renewable energy development. Utilities can build their own solar plants to achieve the legally‐mandated annual RPS benchmarks, and they can also meet these benchmarks by encouraging the private

development of solar projects tied to the grid. By buying Solar Renewable Energy Certificates(SRECs) from the owners of those private solar projects, the utilities can count those energy credits toward meeting their own RPS renewable energy mandates.

In this way, laws like Ohio’s SB‐221 encourage utilities to build their own solar generation facilities, while also encouraging them to promote distributed generation of solar power.

We Can Help

As part of our service, Third Sun Solar will be pleased to provide consulting to assist you in securing the best deal for your SRECs. Although many installers receive commissions or a “cut of the deal” in exchange for steering their customers to certain buyers, Third Sun Solar has made the decision to not seek any income from our customers’ SRECs. You can trust that our advice is unbiased and that our only goal is to see you maximize this revenue stream and quicken your solar energy ROI.