SREC prices have risen 29% to $214.72 average in February 2015 compared to $166.30 in February 2014. Prices are currently trading $200 for new SRECs for immediate payment and delivery on the Flett Exchange trading platform. This is off from 3 year highs of $220 reached last month.
Prices rose in January and February due to the active hedging leading up to and after the BGS auction in which energy providers contract to sell electricity to New Jersey customers who do not choose a 3rd party supplier. The auction winners competitively manage their SREC obligations by buying spot and long term contracts from solar owners and shovel-ready solar projects. In another closely watched auction Electric Distribution companies of New Jersey sold 32,766 SRECs yesterday at a clearing price of $211.01. (Larger volumes tend to get a premium on the auctions)
The New Jersey Office of Clean Energy reported that 17.8 Mw of solar was installed in February bringing the total up to 1,456 Mw of operating solar. This amount of solar almost exactly matches the average amount of solar installed during the past 6, 12 and 24 months. It appears that the solar development in New Jersey is under control and is developing in line with state growth goals set out by legislation.
Prices for SRECs may drop in the future if the development exceeds the state mandates which is why we monitor the monthly build rates. We suggest to sell your SRECs on a consistent basis when prices are high like they are now.
The following is a chart showing SREC prices compared to monthly install rates.
DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.