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Solar installed in New Jersey prior to 2017 generate SRECs for 15 years. After that time they generate Class 1 RECs. SRECs are worth $200 or more. Class 1 RECs trade for $30 today and go only as high as $50.
It is confusing as to when your system is going to convert from SRECs to Class 1 RECs. Here is what you need to do to figure this out.
Here is a Key:
If your array went online from June 2008 and up to and including May 2009 the last SREC you will mint is May 2024. Your first Class 1 REC will be your June 2024 generation.
If your array went online from June 2009 and up to and including May 2010 the last SREC you will mint is May 2025. Your first Class 1 REC will be your June 2025 generation.
And so on…
When you produce Class 1 RECs you sell them the same way on Flett Exchange. You can either check the price on the Flett Exchange website https://www.flettexchange.com/ and transfer them on GATS to Flett Exchange, LLC or you can list them for sale on the Flett Exchange trading platform and transfer them on GATs to Flett Exchange,LLC. when you are filled.
Since Class 1 RECs are lower priced we suggest to wait 6 months to a year to sell them in bulk. Class 1 RECs are only good for 3 energy years so do not wait too long or they will go worthless. SRECs are good for up to 5 energy years.
It is very important to enter your meter readings within 30 days after your system gets converted to a class 1 facility. If you do not put in your meter readings within 30 days all of the months that you deserve to earn SRECs will be created as Class 1 recs. You may lose thousands of dollars!!!
(As of this writing we believe GATS is fixing this issue but we cannot confirm. Best practice is to make sure the meter reading is entered in a timely fashion.)
GATS will send you an email that says the following:
“Your solar electric generation facility's NJ SREC eligibility period will reach the end of its qualification life within Energy Year ("EY") 2021 which ends on May 31, 202X. All generation should be entered prior to the last business day in June. Facility eligibility will be changed from Solar (SREC) to Class I (REC) on July 1, 202X. “
Flett Exchange is the largest exchange for New Jersey Solar Class 1 RECs. Many energy companies compete to purchase SRECs and Class 1 RECs on our exchange which ensures you get the going market price.
Edit: Updated GATS terminology.
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All RECs registered in GATS from solar and wind facilities in PJM installed after January 1, 2003 can be used for New Jersey Class 1 compliance. Also, New Jersey Solar facilities that have outlived their SREC qualification of 15 years (or 10 years if the SRP registration for the solar project was filed on or before October 29, 2018) qualify as Class 1 RECs. These can be purchased by energy companies to satisfy their class 1 compliance. The life of the Class 1 rec is three energy years. Energy years run June to May. Compliance is done in the fall of each year.
How do I sell my Class 1 RECs?
If your New Jersey solar facility no longer qualifies for SRECs you can sell them as Class 1 RECs on Flett Exchange. It is the same process as you did with your SRECs except you sell them on the Class 1 market of Flett Exchange. If you have an account with Flett Exchange you can transfer them on GATS to the Flett Exchange account. Enter the Class 1 sell-now price published on the www.flettexchange.com homepage. We will process the trade, email you a confirmation and issue payment the next day.
New Jersey Class 1 REC Value
The range for Class 1 RECs in New Jersey is $0 to $50. $50 is the Alternative Compliance Payment (ACP), or fine, that energy companies in New Jersey have to pay if they do not procure enough Class 1 RECs. The value for Class 1 RECs is $30 at the beginning of 2024 and is expected to move up to the $40 to $45 levels during the 2025 to 2030 timeframe. This rise is expected because New Jersey law requires energy companies to either produce more renewable energy or buy more Class 1 RECs in the coming years.