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September 30, 2012

The Solar Market?


Solar panels come to Union County, but program's future not so bright

(Excerpt)
...But instability in New Jersey’s market for solar energy credits, known as SRECs, has raised concerns about the program’s potential to be expanded in the future. And it also calls into question the revenue streams of a private company, California-based Tioga Energy, which owns the solar panels and is obligated to pay back $15 million in debt that Union County guaranteed.
It’s one of many public-backed solar energy initiatives undertaken in New Jersey in recent years, and the uncertainty that surrounds it is an example of what’s being experienced around the state in other parts of the nation. 
The SREC credits, essentially a subsidy, are awarded to homeowners, businesses and utilities that generate energy with solar panels. Prices are set on a market in which utilities buy credits to meet state-mandated quotas. 
For the first few years of the SREC market, solar panel owners got $600 or more for each SREC they earned by generating 1,000 kilowatts of solar energy, equal to about two thirds of the monthly electricity needs of the average New Jersey household. 
Then, once supply of SRECs exceeded what the state told utilities to procure, prices plummeted to the mid-$100 range on spot markets.
That was bad for anyone who relied on high SREC values to pay off solar panel financing, like Tioga, and bad for solar builders if it brings new projects to a screeching halt. 
To save jobs, the state Legislature sharply increased the utilities’ demand for credits over a three-year period, and Gov. Chris Christie signed the bill into law in July. 
So far, though, it hasn’t worked: Prices on the spot market dropped from the mid-$100s to $60 or $70 as of last week, according to the SREC trading company Flett Exchange. 
In the case of the Union County program, Tioga will generate the majority of its revenue by selling electricity to the agencies that allowed it to install the solar panels. But it will also sell SRECs to generate income, and the low prices are bad for its bottom line. 
"We’re going to have to dig in to our own coffers to make the bond repayments," said Marc Roper, the company’s vice president of sales and marketing....


1 comment:

  1. You might be qualified for a new government solar program.
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    ReplyDelete