Incentives & Policy

SREC

A Solar Renewable Energy Certificate (SREC) is a tradeable certificate representing the environmental attributes of one megawatt-hour (1 MWh, or 1,000 kWh) of solar electricity generation. SRECs are separate from the actual electricity produced — they represent the environmental benefit of generating clean energy and can be sold independently from the power itself.

SREC markets exist in states with Renewable Portfolio Standards (RPS) that require utilities to source a specific percentage of their electricity from solar energy. Utilities that cannot generate enough solar power themselves must purchase SRECs from solar system owners to demonstrate compliance. This creates a market-driven revenue stream for solar owners beyond the value of the electricity itself.

SREC prices vary dramatically by state and market conditions. In states with strong solar carve-outs and limited supply, SRECs can trade for substantial amounts per certificate. In states with surplus solar capacity or weak RPS requirements, SREC values can drop significantly. Prices are set by supply and demand in each state's SREC market.

To earn SRECs, your solar system must be registered with your state's SREC tracking system and have a production meter that reports generation data. As your system produces electricity, SRECs are automatically created in your account — one SREC per MWh of verified generation. You can sell them directly on SREC trading platforms, through aggregators, or via long-term SREC contracts that lock in a price for multiple years.

Not all states have SREC programs. As of the mid-2020s, active SREC markets include New Jersey, Massachusetts, Pennsylvania, Maryland, Delaware, Ohio, Illinois, and Washington D.C. Check your state's renewable energy policies to determine if SRECs are available in your market.

Frequently Asked Questions

How much can I earn from SRECs?

SREC income depends entirely on your state's market. Strong markets can yield meaningful annual revenue per kW of installed solar capacity. A 6 kW system producing 8 MWh per year earns 8 SRECs annually — multiply by the current SREC trading price in your state for estimated income. Prices fluctuate with supply and demand.

Do all states have SREC programs?

No. SREC markets exist only in states with solar carve-out requirements in their Renewable Portfolio Standards. States like New Jersey, Massachusetts, and Maryland have active SREC markets. Most other states rely on net metering and the federal ITC as the primary solar incentives without a separate SREC program.