Sustainable Energy Advantage (SEA) is the consulting leader in conducting solar renewable energy certificate (SREC) supply / demand / price analysis and forecasting and has built the tools to provide forecasts in the historically robust Massachusetts, New Jersey, and Maryland.
SEA takes a bottom-up approach forecasting SREC markets as a function of:
Supply (recent historical and future), which is a function of:
- kW Installed
- kW Pipeline (which is a function of many variables including expected SREC revenue which could make the modeling iterative)
- Typical meteorological year (TMY) capacity factors weighted by program project type
- Degradation rates
- Near-term supply of yet minted SRECs which is particularly important in the Massachusetts SREC market where SRECs are minted 3.5-5.5 months post energy production by leveraging near-real-time NASA irradiance data
- Banked SREC supply and baking behavior
- Renewable Portfolio Standard (RPS) supply obligation percentage
- Historic and forecasted retail electric load
- Retail load exempt from the RPS obligation
- Banking behavior
- Load serving entity bankruptcy / market withdrawal
- Current and future alternative compliance payment price (ACP)
- Floor price / auction price, if any
- Class I REC backstop price
- Risk / discount rate
An example modeling flowchart for Massachusetts SREC spot market pricing is provided below.
SEA honed its approach to SREC modeling from its 2014-2022 Massachusetts Solar Market Study subscription services and various bespoke consulting analyses of the New Jersey and Maryland SREC markets.
Typically, SEA tracks all policy, legislative, and regulatory developments at a granular level, allowing us to anticipate programmatic changes and model possible futures, risks, and their implications.
SEA analysis is independent and objective as it is not captive to any sector or trading in SREC or REC markets therefore has no rose-colored glasses.
See the blogs 2020 MA-SREC Post-Mortem, and Where Did the Sun Go? A Quick Look at Solar Panel Degradation in Massachusetts as examples of the depth of the analysis which SEA deploys. If you are interested in objective and thoughtful SREC supply / demand / price forecasts for the Massachusetts, New Jersey, Maryland or District of Columbia markets we are ready to help.
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