The market for Delaware SRECs is one of the oldest in the country. It originated in 2005 and was subsequently amended in 2010. The state’s renewable portfolio standard (RPS) aims to source 25% of its electricity from renewables by 2025-2026 with a solar specific goal of 3.5%.
Similar to Pennsylvania, its neighboring state, pricing for Delaware SRECs have steadily fallen throughout its lifetime. Is it time to increase the RPS in Delaware? We sure hope so.
Delaware’s Renewable Portfolio Standard
- Delaware’s renewable portfolio standard (RPS) requires that 25% of the state’s electricity be sourced from renewable energy by 2026, with a 3.5% carve-out specifically for solar energy. This goal has not been revisited since 2010.
- The solar alternative compliance payment (SACP), the penalty fee levied on compliance buyers who do not meet the District’s solar targets, is currently set at $400 per megawatt hour (1000 kWh). This penalty fee increases each time a compliance entity claims it. After the first time, it goes up to $450 per MWh, and $500 per MWh for years after that. However, given that the Delaware SREC market is so oversupplied, the ACP does not have much, if any, impact on pricing currently.
- SRECs up to three years old can be sold in Delaware. Therefore, customers who have registered their systems on their own or through an aggregator will still be able to sell their SRECs, provided they were minted in the last three years.
- If you’d like to learn more about Delaware’s RPS you can visit Delaware’s Public Service Commission’s website.
Delaware Procurement Programs
Aside from selling SRECs on the spot market, Delaware offers two alternative options for customers trying to figure out the best way to sell their SRECs. In 2011, Delaware’s RPS was amended and switched who was required to buy SRECs from state power providers to the electric distribution companies. Because of this switch, Delmarva Power became the largest SREC purchaser in Delaware. This led to the creation of the Delaware Procurement Program. Under this program, customers can bid into 20-year fixed price contracts with Delmarva Power, where the first ten years are at the bid price, and the remaining ten years are at a pre-specified fixed price per SREC. Bid groups are divided into different tiers based on system size and interconnection date. This procurement happens annually, typically around the beginning of the summer.
Another option for customers located in Delaware is the SEU SREC Purchase Program. Under this program, an upfront payment per kW is paid in exchange for the first 20 years of SRECs created by a system. This program is only for systems less than or equal to 50kW.
- Customers must submit copy of the customer’s signed interconnection agreement, a signed contract, and a Delaware certification number before we can register the system.
- Registration with the Delaware Public Service Commission is handled by the installer, not Sol Systems. After registration, customers should provide Sol Systems with their Delaware Certification number. This number will be in the form of DE-#####-SUN-01-##-##.
- Upon receipt of all documentation, Sol Systems will register a customer’s solar energy system with the Generation Attribute Tracking System (GATS), the regulatory body that mints SRECs.
- Sol Systems does not charge a registration fee.
- Registration with GATS generally takes about a month.
- SREC eligibility starts with the date that the application is approved by the Public Service Commission (PSC).
- Systems smaller than 10 kW that don’t have a dedicated meter are eligible to report their generation through production estimates using a tool called PV Watts.
- For systems wishing to participate in either of the procurement programs, a revenue grade meter is required.
- Only photovoltaic systems are eligible for SRECs in Delaware. Solar thermal systems and other renewable facilities are not eligible.
Sol Systems makes payments to Delaware customers on a quarterly basis according to the following schedule.
|Generation Quarter||SREC Payment|
|Q1: January, February, and March||May|
|Q2: April, May, and June||August|
|Q3: July, August, and September||November|
|Q4: October, November, and December||February|
For example, on the last business day in May, Sol Systems will issue payments to customers whose energy production passes a 1000 kWh threshold in Quarter 1 (January-March) and their SREC has sold.
Sol Systems customers can receive their payment via paper check or direct deposit.