Why Virginia and why now
In 2020, Virginia’s legislation passed the Virginia Clean Economy Act in hopes to encourage residents, business owners and utilities to adopt cleaner energy practices. What this essentially did was require large utilities, like Dominion, to purchase RECs and be sourced from renewable energy. After all the legislation dust had died down, what was found was an opening of a very large and now eager market ready to take advantage of these changes.
What is Virginia’s SREC market like?
There are a variety of elements that fuel the SREC market. Being that Virginia’s market is of the newer age, REC pricing can vary from $30 - $60 per REC at present. The more systems that are registered and REC’s sold, the lower the price per REC will fall. There are a few important facts to note when considering VA pricing. The first is the Alternative Compliance Penalty (ACP) for SREC, ’s is currently set at $75. This means that for every SREC the utility companies fall short, they must purchase for $75. This fee increases by 1% annually, making the second year’s compliance fee $75.75 per SREC. The ACP acts as a ceiling price for the market.
Another notable item is that not all VA systems are eligible for selling in the VA market itself. Virginia's State Corporation Commission (SCC) entered an Order and updated PJM's GATS Business Rules for Virginia RECs adopting a new business rule to clarify that all systems regardless of size be required to measure generator output with a revenue-grade meter (RGM) which must meet the ANSI C-12 standard. This ruling impacts the majority of Virginia systems with SolarEdge inverters and systems installed before 2019. The good news is that VA systems that do not qualify in VA are still eligible for the Pennsylvania Tier 1 (PAT1) Market. PAT1 Market is at a lower price per SREC. As of the date of this article (7/18/2022), it is around $23/SREC.
Lastly, Virginia’s market allows for the selling of your retroactive SRECs produced backdating from the approved GATS registration date back to January of that calendar year. This means that if your system is registered on June 1st, 2022, you would be eligible to sell RECs back from Jan 1, 2022, at a discounted price.