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SRECs

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Greenzu Eliminates The Hassle
of SRECs

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Solar Renewable Energy Certificates (SRECs)

Another way to offset the cost of a solar installation is through Renewable Energy Certificates (RECs or SREC, which is just for solar). RECs are a financial trading mechanism used to measure and define the environmental attributes of renewable energy. These are separated from the solar electricity itself and sold distinctly as credits to individuals and businesses looking for a way to symbolically neutralize their greenhouse gas emissions.

SRECs are created with the understanding that there is one credit for each unit of energy, usually one megawatt-hour. Once sold, an SREC cannot be sold again – a concept known as SREC retirement. In this way, the renewable energy is monetized and sold on an SREC market. There are two types of markets: compliance and voluntary.

Compliance markets are created by states that require that a certain supply of their energy come from alternatives. The price per megawatt or kilowatt hour per credit is higher in a compliance market than a voluntary one. In a voluntary market consumers choose to buy the SREC out of desire to use an alternative energy source. These SRECs are usually significantly lower in monetary value.