The third Massachusetts SREC I Auction cleared in the first round for the first time amid overwhelming demand. Preliminary results of the Auction indicated mixed implications for forward supply and demand scenarios. Can the SRECs sold in the Auction help satisfy the projected shortage in 2015 Compliance Obligation? Will enough of the reserve of re-minted SRECs be held out for future usage to relieve the perceived tightness in 2016 supply? The Karbone Research Desk addresses forward supply & demand dynamics, pricing, and market balance concerns in this report.
Grid-Supply projects in the development pipeline have finally impacted the market bringing last month’s new solar build number up to approximately 14.4 MW. June had two new Direct Grid Supply projects with total capacity of 5.86 MW – compared to only one Grid Supply project since February, previously the only Grid Supply project YTD. With relatively anemic total build numbers for Q2, New Jersey SREC prices have shown an expected resilience in the front end of the curve from early spring through mid-summer.
Mark Sylvia, MA DOER Commissioner, on December 13 presented to the Electricity Restructuring Roundtable the final policy design for the RPS Solar Carve-Out II Program. The presentation included important developments in the market structure, such as SREC Factor changes, an ACP funded financing program, and raising the Net Metering (NM) Cap, which Karbone will cover in this report.
The following research brief will provide an update on the New Jersey SREC market recent trends, and explain Karbone’s price forecasting in the lead up to the BGS Auction in February 2014.