I signed up for our SREC account today, and this answered a lot of questions. I've been wondering how to manage this account, since we're not planning to sell our SRECs through a broker. It looks like I can do everything through the New Jersey Clean Energy Program (NJCEP) website. Most notably that includes monitoring our meter readings and solar production statistics as well as selling our SRECs.
Once I log into our account the menu looks like this:
The bulletin board section includes a message board where offers to buy and sell SRECS (quantity and price) are posted along with contact information.
There are some really cool people installing solar electric systems. It isn't as radical as it might seem. Here are links to the stories of two of them (hopefully they won't mind being linked up here):
The Watsons and their beautiful solar-paneled house (this website has a lot of useful links): http://256.com/solar/
By the way, I really need to call the guy from BP Solar and tell him that we ended up signing with another company. Every time I go to Home Depot he's there at a table handing out information so I have to sneak in through the Garden Center or contractor's entrance.
I really thought we'd end up working with them. They just wouldn't accept the idea that our New Jersey rebate was still valid and wouldn't incorporate it into any proposal.
We received a call from groSolar today. They're planning on beginning the installation in about three weeks, which is much sooner than the July date that we were expecting. There's no reason not to do it sooner, though, if they can. I can expect a call soon from the project manager, E.F., to start coordinating the installation. They will take care of all the permits and handle all matters with the power company, PSE&G.
In the meantime I have to get busy on submitting the construction application and paperwork to our homeowner's association. Also, I have to contact the New Jersey SREC Program Administrator to register for an SREC account. That's where an SREC will be deposited each time we generate 1000 KW of energy.
Home energy prices will be rising sharply in the next few years. This article from The Philadelphia Inquirer explains that PECO (A Philadelphia area utility company) has held down prices as part of a recent restructuring/rate cap plan that ends in 2011. I'm guessing that the same is in store with regard to utility companies everywhere else. Being immune to this is one more benefit we'll have when we're producing most of our own power.
"State officials have warned that double- or triple-digit rate increases could occur as price caps expire and utilities enter the next phase of the state's power-industry restructuring. Spikes have happened elsewhere to customers protected by caps that expired before Peco's."
"Last year, Peco itself predicted its prices would rise about 20 percent for residential customers in 2011..."
Apparently the SREC is a state-based concept. I was poking around the internet and saw a New Mexico state government website describing their own program, which was similar but clearly independent.
Here in New Jersey it works like this. The SREC is a tradeable "certificate". It's electronic, though, not paper (Previously I was thinking it would look something like a Willie Wonka golden ticket). Each time 1000 KW of power is generated, an SREC is issued.
The value of SRECs will fluctuate much like the price of a stock on NASDAQ or NYSE. Currently they are trading for about $600. It could be that SRECs drop in value as more systems like ours go online meaning that there are more SRECs on the market. On the other hand, the SREC market is completely artificial, driven by the law that specifies how many SRECs the utilities must purchase. That will also rise each year which will probably negate the effect of a growing number of SRECs.
The SREC is issued by an SREC administrator who is appointed by the New Jersey Board of Public Utilities. This office tracks energy production for systems like ours, issues SRECs, and records sales/trades of SRECs. I'm still not clear on how this SREC Czar tracks our production but it must be through our power company (PSE&G) and their electric meter.
As I understand it the SREC market consists of the current providers of electricity in the state (the utility companies), who are required to purchase a minimum number of SRECs under New Jersey's Renewable Portfolio Standard. The number of SRECs the utilities must purchase rises every year under the current law, the purpose of which is to encourage the growth of renewable energy to meet growing needs for electricity rather than construction of new power plants.
Operators of solar systems can manage their own SRECs. To do this they must register with the SREC Czar for an SREC account. When SRECs are issued, presumably they are automatically deposited in this account.
Many operators enroll with commercial SREC brokers. This must be a lucrative business because every installer seems eager to push their customers towards their preferred broker. These companies will manage the sale of SRECS for a fee. My first impression is that unless it's more difficult than it looks, it would be wise to handle this ourselves.
groSolar sent us literature from their preferred broker. The proposal wasn't written very clearly but the gist of it was that we had to commit for five years. For part of the duration the installer actually receives a percentage of the profit, which explains why groSolar is anxious for us to enroll. At some point early on during the duration of the contract the arrangement settles into an arrangement by which we would keep 60% and the broker would keep 40% of the money generated by SREC sales. That seems steep, although one benefit of working with this broker is that they guarantee a minimum payment of $200 per SREC regardless of how low value drops.
We're still learning about SRECs. We've got about three months to master it.
Before the New Jersey Clean Energy Program (NJCEP) will forward our rebate directly to groSolar we need to refile a rebate application. Until the change is approved the rebate can only be paid to Mesa/SunTechnics, who is not installing our system. R.B. from groSolar prepared this document which we signed and mailed off to NJCEP today.
Hopefully this is just a formality. T.G. from NJCEP told us last month by e-mail that the rebate is still valid and that all we needed to do was refile with groSolar as the installer, but I'll believe this when I see it on paper.
Since the size of our system has decreased from 9.84 KW/month to 9.12 KW/month, the rebate is slightly smaller than before (down from approximately $37K to $34K). It bothers me that this dollar amount isn't on the application anyplace, but then again it didn't appear on the initial application either. When we get an updated approval letter from NJCEP with the new installer, system size and rebate amount spelled out, I'll feel better.
Net cost after 1 year: ---------------- > $ 18,236.00
- prepare all state grant applications - Pull permits and schedule inspections - Deliver equipment to site - Prepare installation area for module installation - Install modules and racking - Wire array and run conduit to main panel. Pull wire through
conduit. Connect to mainbreaker.
- Install and program inverter.
- Provide owner's manual and one line diagram of system for client.
We've played phone tag with the groSolar guy. Once we caught up with him we were really impressed. He he really knows the topic and wants to get this system built as much as we do. He's coming out to the house on Tuesday, March 31 to assess, measure and write up a proposal. He checked and confirmed that we can receive our high rate New Jersey rebate and still take the federal tax credit.
March 21, 2009
The BP Solar representative won't present us with any deal that includes our high rate New Jersey rebate. We decided to call groSolar after seeing a full-page ad in the Courier-Post.
March. 13, 2009
We received confirmation from the New Jersey Clean Energy Program that we are still on track to receive the higher rebate so long as our system is operational by July 31, 2009 (the offer was valid for one year).
March 12, 2009
A.S. came by, took measurements and wrote up a proposal (which I don't have because either he took it or I lost it). The only snag we see is with the New Jersey rebate. He doesn't think we will be able to get the higher rebate at the rate from last August.
March 4, 2009
Attended the seminar at Home Depot. Here are some key sections of the literature that was handed out:
Why solar electric now?
The average system installed in New Jersey eliminates 10,000 lbs. of CO2 every year! Installing solar today will help decrease your carbon footprint immediately. Additionally, we must remember that energy is a global problem. Worldwide demand for energy is increasing as supply is decreasing. What it means to us...higher and higher pricing.
Cost of electric power doubled in the last 7 years - thats 9% a year! Energy prices will continue to spiral up, and those that rent their electricity will have to pay whatever their utility company asks.
How Does a Solar Electric System Work?
When the light of the sun interacts with your solar modules (array), direct current is produced. That direct current is sent to your inverter and the inverter changes (converts) that direct current into alternating current. The alternating current is then sent to your circuit breaker and you now are using clean, natural power in your home. When you produce more power than you use, the excess power goes through your electric meter and that meter actually spins backwards as the power goes back to the grid. At night you will get your electricity from the grid. You make deposits, you make withdrawals. This is called net metering.
Is solar right for you?
You need a sunny roof with NO SHADE. South facing is best. East or west also works. North facing does not qualify for your rebate.
The news from the seminar was mixed but mostly good. New Jersey has scaled back the rebate program from $3.50 per watt to $1.75 per watt. I'm pretty sure we would be grandfathered in at the old, higher rate since we qualified and locked in last August.
There is also a 30% federal tax credit that is completely uncapped. We wouldn't benefit from that until 2009 tax returns are filed but it's a big chunk of money.
They are also offering a program to guarantee a floor price for the SRECs that we would sell, provided that we bundle them into their program. Also, they are offering to finance the balance not covered by rebate or tax credit through the power company (PSE&G) itself. We probably wouldn't need to bother with that part since we've already taken out a loan for our project.
By the way, New Jersey isn't the only state that offers incentives. Here is an online database of incentive programs across the country:
Here's the typical deal as presented at this seminar (see the BP Solar / Home Depot website for more detail):
36 modules, 200 watt each - complete Home Depot price (with coupon) -- $ 59,256
30% federal tax credit - $ 17,777
New Jersey Rebate $ - 12,600
Net cost: $ 28,879
Finance 28,879 for 10 years at 6.5% interest rate through PSE&G = $328 / month.
Their model includes an average monthly SREC income of $317 and average monthly savings on electricity bills of $144 per month. These aren't figured into the above sample deal but would enhance the value of the system.
I was interested, and arranged for A.S. to come out to the house, assess what they could do and work up a spec and a deal.
March 1, 2009
While in Home Depot we ran into A.S., a BP Solar representative who was there pitching the new solar collaboration between BP and Home Depot. It sounded pretty good. There are some new incentives available.
Here's a place to read up on what BP Solar and Home Depot are offering: