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September 8, 2011 Third Party Suppliers in New Jersey were largely caught off-guard by the final SREC requirements that were issued on August 26th, 2011. Compliance reports for the 2011 energy year are due on October 1st. At that time any company supplying electricity in New Jersey has to either retire SRECs or pay a solar alternative compliance payment SACP to the State. The SACP for energy year 2011 is $675. Any SACP payments are refunded to ratepayers. Confusion over the required amount of SRECs stems from the change from a percentage requirement to a fixed requirement that went into effect in January 2010 with passage of A3520 the Solar Energy Advancement and Fair Competition Act. Any Basic Generation Service BGS Providers with contracts entered into before passage of the Act remain on the percentage requirement until the contracts expire. This shifted more of the demand onto the Retail Electric Third Party Suppliers. Those suppliers had procured what they thought was their requirement less a few percentage points worth due to the loss in value in the roll to energy year 2012 SRECs which are only trading $195 today on the Flett Exchange electronic marketplace. Prices for energy Year 2011 and 2010 SRECs rallied $164.74 from a $457.09 Flett Settlement on August 25th to a $621.83 settlement on September 7, 2011.
The following is the New Jersey Renewable Portfolio Standard Energy Year 2011 Preliminary Solar Compliance Data issued by the New Jersey Board Of Public Utilities on August 26, 2011:
NJ Retail Electric Third Party Suppliers, Electric Distribution Companies and BGS Providers: From data submitted to the Office of Clean Energy in the New Jersey Board of Public Utilities (Board staff) by the state’s four Electric Distribution Companies, thirteen unique BGS providers served retail electric end users with 31,334,037 MWhs under contracts entered from the 2008 and 2009 BGS auctions. This supply of electricity is exempt from the newly developed market share basis for NJ RPS compliance per the regulations adopted pursuant to the Solar Advancement Act of 2010.
The reported exempt retail sales must comply with the RPS regulations as they existed at the time of the Act’s passage in January 2010 which was 0.3050 percent of retail sales. As a result, the providers with exempt supply are required to retire SRECs or make SACP payments in the equivalent amount of 95,569 MWhs. The RPS requirements for EY2011 are 306,000 MWh equivalents, ie SRECs retired and SACP payments made by all NJ retail electric suppliers and providers must sum to 306,000 MWh. As a result, non-exempt suppliers and providers must retire 210,431 SRECs or make SACP payments.
The EDCs also reported reconciled retail sales data for the BGS providers with non-exempt retail sales, ie entered under contracts from the 2010 BGS auction as well as preliminary, unreconciled retail sales data for Third Party Suppliers in their respective territories. EDCs reported 17,709,103 MWhs from non-exempt BGS providers and 32,198,209 MWhs from Third Party Suppliers who were not exempted from the Solar Advancement Act’s change to the RPS market share basis for compliance with the solar requirements. The total unreconciled non-exempt retail sales are 49,907,312 MWhs. If you represent a non-exempt supplier or provider, your preliminary solar obligation for that supply can be calculated by dividing your retail sales number as contained in the PJM GATS “My RPS Compliance” report by 49,907,312 and multiplying by 210,431.
Third Party Suppliers have two weeks, by COB Monday September 12 to review their My RPS Compliance report for accuracy with their EY2011 retail sales amount and reconcile the number if required. If the amount in the My RPS Compliance report is inaccurate you must report your final retail sales amount to OCE along with a written explanation for the difference. Please submit reconciliation requests with explanation to OCE@bpu.state.nj.us.
By COB Friday September 16 the OCE will issue a notice of the final retail sales amounts via the NJCleanEnergy.com website and PJM-EIS GATS system. Any questions or comments feel free to use the OCE@bpu.state.nj.us email or contact Scott Hunter at 1-609-292-1956 or Ron Jackson at 1-609-633-9868.
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Flett Exchange is the leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Over 3,300 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs in a secure and seamless online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers (it’s simple sell a SREC and receive a check!) Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, CT, MA, and DC and supported by trained solar professionals with specialized knowledge and proven experience.
Flett Exchange brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-7 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services.
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