Each time a project generates 1,000 kWh of electricity, an SREC is earned. System owners report the energy production to the SREC tracking system, which allows SRECs to be placed in the customer’s electronic account. SRECs can then be sold on the SREC tracking system, providing revenue for the first 10 years of the project’s life (15 years for projects before mid 2018).
Electricity suppliers, the primary purchasers of SRECs, are required to pay a Solar Alternative Compliance Payment (SACP) if they do not meet the requirements of New Jersey’s Solar Renewable Portfolio Standard (RPS). One way they can meet their RPS requirements is by purchasing SRECs. As SRECs are traded in a competitive market, the price may vary significantly. The actual price of an SREC during a trading period can and will fluctuate depending on supply and demand.
To learn how to cash in those SRECs, check out our “How to Sell and Manage your New Jersey SRECs” post.
Who manages the SREC tracking system?
New Jersey’s Clean Energy Program uses the SREC tracking system developed and supported by PJM-EIS.
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