How Optimizing your Solar Array Maximizes SREC Return

Published May 31, 2016

How Optimizing your Solar Array Maximizes SREC Return

DATE PUBLISHED: May 31, 2016
Category: Blog Article


Solar arrays are an excellent way for a company to impact the environment while reducing operating costs and creating additional revenue. One way a solar owner can generate additional revenue and recoup the cost of their system is through the sale of Solar Renewable Energy Certificates (SRECs).

SRECs are a tradable, non-tangible energy commodity that represents one megawatt-hour of electricity produced by a renewable source – specifically through solar energy. In the United States, SRECs hold value, as they can be purchased by utilities to meet Renewable Portfolio Standard (RPS) requirements that dictate what percent of their total electric output must be produced by renewable energy sources. For a complete overview of SREC generation and an explanation of their value, please refer to our blog post from last week, What is an SREC?

The sale of an SREC or a bundle of SRECs can have a significant impact on a solar array owner’s bottom line. Especially in a market such as Massachusetts, where the certificates are highly valued, SREC sales can contribute a substantial portion to overall system ROI. However, since SREC generation rate is directly correlated to system production, SREC value can only be maximized when the system is operating at an optimal level.

So how do you ensure optimal array performance? Through solar O&M.

Solar operations and maintenance (O&M), also known as solar services, is the division of the solar industry dedicated to system optimization and efficiency. Through a comprehensive program of offerings, solar service providers regularly monitor and maintain solar arrays to ensure they are performing at optimal rates. When a monitored solar array behaves abnormally, a service provider will send a technician to the site to diagnose and rectify whatever is causing the abnormality. The entire goal of solar services is to minimize system downtime in order to maximize production.

Additionally, a solar service provider can help you manage the SREC process, watching the SREC market closely to ensure you secure the best price for your SRECs, and in turn receive the best return on investment possible. SREC management services typically include quarterly performance information, state filing administration services, quarterly and annual SREC reporting, market information communications, SREC tracking and trading, and scheduled quarterly SREC payments.

Solar services and SREC value optimization go hand in hand, as one cannot optimize SREC return without first optimizing array output. In order to ensure the largest possible system return on investment, it is crucial for an array owner to pursue a solar service agreement. An experienced solar service provider can assist in managing and optimizing SREC revenue.