State & Local Incentives

Turnkey services; Solar Nation identifies the available state and local incentives and prepares everything necessary to qualify.

State and local governments have created a variety of programs to encourage the adoption of solar power. Solar Nation identifies state and local incentives that are available for our customers and prepares all paperwork necessary to qualify. When combined with federal incentives, including the Federal Renewable Energy Grant or Federal Investment Tax Credit, Modified Accelerated Cost Recovery System (“MACRS”), and USDA programs, these state incentives typically effectively help underwrite the cost of installing large solar-electric system by as much as 100%, allowing for returns on investment of 15%-25%.

Incentive programs vary considerably from state to state. “MACRS” depreciation can be used against state tax liability, property and sales tax exemptions, and valuable solar renewable energy credits may be available. Find out more about programs in your area by visiting the Database of State Incentives for Renewable Energy (DSIRE).

Renewable Portfolio Standards

Renewable portfolio standards (“RPS”) are state polices that require electricity providers to obtain a minimum percentage of their power from renewable resources, such as solar, by a certain date.

• Currently 24 states plus the District of Columbia, have RPSs; 16 of those states require a certain percentage of their RPS to be generated through solar (a “Solar Carve Out”).
• Some states have implemented a solar alternative compliance payment (an “SACP”) that acts as a fine or penalty for non-compliance with a solar carve out.
• The SACP is effectively an allowable yearly cap on the value of SREC’s to be traded at.

For Example:

• New Jersey has one of the most aggressive RPSs in the United States. The New Jersey RPS requires each supplier and provider serving retail customers in the state to procure 22.5% of the electricity sold in New Jersey from qualifying renewables by 2021.
• NJ Solar Carve Out requires 2,518 gigawatt-hours (GWh) from in-state solar electric generators by the end of energy year 2021, and 5,316 GWh during energy year 2026 and each year after.

NJ SACP Eight Year Schedule

Reporting Year	SACP $/KWH
2008-2009	$.71
2009-2010	$.69
2010-2011	$.68
2011-2012	$.66
2012-2013	$.64
2013-2014	$.63
2014-2015	$.61
2015-2016	$.59

Solar Renewable Energy Credits

Solar Renewable Energy Credits (“SRECs”) are tradable commodities that were developed to place a value on clean, renewable sources of energy. These credits can be sold in compliance markets to utility companies who need to meet mandated renewable energy portfolio standards or the credits may be sold in voluntary markets to organizations who wish to meet renewable energy goals. Producers of solar energy, are credited with one SREC for every 1,000 kWh (1 MWh) of electricity produced.

• An SREC is a tradable environmental commodity in the U.S., providing proof that 1 megawatt-hour (MWh) of electricity was generated from a clean renewable energy source.
• The electricity itself is not sold with the SRECs. The reduced cost of energy is a separate benefit.
• SREC certificates are sold and traded directly to utility companies serving ratepayers. The utilities in turn use these certificates as proof of compliance with the mandated RPSs.
• The price of SRECs are a function of their market availability and the price of the SACP for the state RPS.
• Solar PV systems have a 15-year “qualification life,” meaning that they’re eligible to generate SRECs for 15 years after they are connected to the grid. SRECs can be sold on the spot market when they are generated or under a long term (3, 5, 7 years, etc.).

For Example:

New Jersey SRECs have consistently traded at 85% of the SACP Cap

How do you monitor and sell SRECs?

• Revenue grade regional tracking systems such as WREGIS, NEPOOL, GATS, ERCOT, and M-RETS are used to track and log each SREC that is generated.
• The SRECs are then certified by Green-e, Environmental Resources Trust's EcoPower Program, and The Climate Neutral Network.
• An account is created through your tracking system and all SRECs generated are logged and available for trading.
• Trading is conducted daily through several environmental exchanges. Brokers are also available to help you manage and sell your credits.

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