New Jersey's solar renewable energy credit (SREC) market, which has struggled of late, finally may be rallying. SRECs for energy-year 2013 briefly exceeded the $120/MWh mark last week, according to Flett Exchange. In contrast, SREC prices dropped as low as $60 in October.
Flett Exchange attributes the gains to an decreased rate of solar installations in New Jersey, as well as emerging positive effects from energy legislation signed by Gov. Chris Christie last July.
The company predicts that increased SREC demand will maintain a price floor for the market, but any rally will likely be ‘muted’ due to low prices for new solar installations.
‘Some installations in New Jersey are reportedly being built for $2 to $2.50/watt,’ Flett Exchange wrote in a recent email alert. ‘The low cost of installation means that SREC prices do not have to be much higher than $120 to $150. If SREC prices go much higher than that, a large amount of new solar will be built, which will, in turn, depress SREC prices again.’