Over the last decade, Pennsylvania has unfortunately ranked second-to-last in renewable energy growth (encompassing solar, wind, and geothermal energy), according to a new study by the Environment America Research and Policy Center.
There are two easily defined reasons for this:
- Pennsylvania met its renewable energy targets in 2021, so power companies are not incentivized to expand their renewable energy efforts further.
- The ACP (alternative compliance payment) in Pennsylvania is muddy and unclear. Power companies do not have a defined consequence for not meeting their renewable energy goals.
Because of this sad reality, Pennsylvania homeowners receive a far less fair price for their SRECs than homeowners in neighboring New Jersey.
At the time of this writing, Pennsylvania SRECs are at $31 according to SRECTrade.com. This is a very low value compared to neighboring New Jersey, where SRECs are valued anywhere from $90 to $110.
Thankfully, hope is on the horizon!
Several state representatives, including Carolyn Comitta and Steve Santarsiero, minority chair of the state senate’s Environmental Resources and Energy Committee, have introduced Senate Bill 230 and House Bill 1467.
Luckily, as a Pennsylvania resident interested in owning your power and living in a less polluted state, there’s an action step you can take to address this critical problem and raise the price of Pennsylvania SRECs.
TL;DR: Call your local representative and say that you support updating the Alternative Energy Portfolio Standard
If you’d like to know more about why this will work and why the price of SRECs is so low in PA, read on!
HB 1467 and SB 230 are collectively known as the 30by30 initiative. These bills would elevate the portfolio requirement to 30% renewable energy by 2030 if passed. They’d raise the solar energy portfolio requirement from .5% to 14%, a 2800% increase.
Pennsylvania, as the second-to-last ranking state in terms of Renewable Energy Development, desperately needs to update the AEPS. Taking action will protect and create energy jobs, address climate change, and ensure reliable access to power for all Pennsylvanians.
We Can Address this Problem Together!
State Senator Carolyn Comitta, the minority chair of the Senate Energy & Environment Committee, recently wrote an op-ed in the Delaware County Times on the need to update the AEPS, as well as how we can address this issue.
– Senator Carolyn Comitta
While solar energy has been booming in the United States, various policies in Pennsylvania have stunted its growth rate here in our home state, leaving us with adoption rates far lower than those of many of our neighbors.
In 2010, Pennsylvania was one of the top five solar states. Sadly, we’ve since fallen far down the rankings. PennEnvironment Research & Policy Center found that Pennsylvania is the 4th worst in the country for solar growth percentage.
According to a live data tracker published by the Solar Energy Industries Association (SEIA), Pennsylvania has only 61,000 solar installations versus 189,000 in New York state and 178,000 in New Jersey (as of November 2023).
Why Pennsylvania Is Falling Behind
– Senator Carolyn Comitta
Renewables are the future of energy. They now make up 17% of our total electricity in the U.S. Compare this with Pennsylvania, which in the last decade only brought online enough renewable energy to power 2% of the state’s homes, and only purchases 3% of renewable energy out of state.
Pennsylvania lags far behind in renewable energy progress, and not because of a lack of resources. According to data gathered by the National Renewable Energy Laboratory, Pennsylvania possesses enough solar capacity to power the state five times over.
The reason for this lack of progress is a bill that was passed 19 years ago requiring that energy companies include 8% of power produced from “alternative sources” in their portfolios by 2021 Alternative Energy Portfolio Standard (AEPS).
Because there was oil industry lobbying involved, the word “alternative” was used in place of the word “renewable.” The “alternative” power production methods included natural gas.
The AEPS was progressive for its time. Pennsylvania was one of the first states in the union to mandate that any percentage of total power must come from renewable sources.
But the fact remains, “alternative,” is not “renewable.”
The AEPS required 8% of Pennsylvania’s power to come from “alternative” sources by 2021 when it was passed in 2004. Compare that to neighboring New Jersey, who’ve committed to generating 50% of their total power from renewable methods by 2050.
That 8% alternative energy target was hit two years ago and the state stopped seeking renewable energy sources.
Currently, the AEPS only requires that 0.5% of the total energy produced in Pennsylvania come from solar power. This number has stayed the same for almost two decades.
In addition, the SACP (Solar Alternative Compliance Payment) is muddy and confusing in PA.
The SACP is essentially the “slap on the wrist” that keeps power companies accountable. Unfortunately, it’s very easy for PA power companies to work around. It’’s very unclear.
In DC, the average SREC is worth over $400. But the ACP is set at $500. Therefore, each time a power company fails to buy an SREC, they essentially pay a $100 penalty per SREC they don’t buy. Simple.
PA’s ACP is set at 200% of the average SREC price paid by providers in the billing year. Which ends up being very convoluted and easy for power companies to fudge at the end of the year. It’s easier for
All of this combined means that Pennsylvania homeowners who own solar panels aren’t getting a fair price for their SRECs compared to surrounding states. There’s low demand for SRECs and high availability.
Carolyn Comitta and Steve Santarsiero want to change that with SB230 (the companion house bill is HB1467).
Updating the AEPS Creates a Financial Incentive for PA Homeowners
If either were passed, these bills would update the required amount of renewable energy required in the Alternative Energy Portfolio Standard.
The easy way to remember these bills is the slogan “30 by 30.” They would update the amount of renewable energy power companies must use to 30% by 2030.
Within this 30% requirement, 14% would be dedicated to solar energy—up from 0.5%. The bill pushes for the full development of the Pennsylvania solar industry, recognizing its pivotal role in achieving a greener, more sustainable future.
Because that’s a lot of Solar to develop quickly, the easiest way for power companies to increase their solar power energy percentage would be to buy it from homeowners. The Pennsylvania SREC prices would likely double or triple, giving solar system homeowners a return on their SRECS comparable to neighboring New Jersey.
Higher-priced SRECs mean Pennsylvania solar system owners can pay back and own their power generation in a shorter timeframe.
If you’re a solar system owner in Pennsylvania or you’re looking to take the plunge and start producing your own power, it is in your best interest that these bills get passed.
By raising the solar standard to 14% up from .5%, we force power companies to increase the amount of solar they produce by 2800% in six years. One of the easiest short-term ways they’ll meet this requirement is by buying SRECs from people who are already producing power.
Pennsylvania SRECs would become multitudes more valuable overnight.
If you’re unfamiliar with Solar Renewable Energy Credits (SRECs), these credits are automatically generated per 1000 kilowatt-hours (kWh) a system produces. Homeowners can sell or trade them.
The price varies based on supply and demand, but one thing’s for sure:
SRECs are worth much more in New Jersey than in Pennsylvania.
The price for one Pennsylvania SREC has fluctuated between $20 to $35 for the last few months. The price for one New Jersey SREC, meanwhile, is currently anywhere from $90 to $110. In practical terms, this means that someone living in New Jersey with a 10 kW roof-mounted system is earning at least $2400 a year for their SRECs, while someone next door in Pennsylvania is earning just over $300.
So, How Can You Help?
Both of these bills have unfortunately stagnated because of opposition from the coal/oil and gas lobbies. But Pennsylvania homeowners can help get them going again.
What can the average person do to support the 30by30 initiative?
When we interviewed Liz Robinson from the Philadelphia Solar Energy Association, we asked how the average person could help drive positive change for the AEPS.
– Liz Robinson, PSEA
It’s critically important that we gather cosponsors and expand the support base to get these bills passed.
Pennsylvanians hold the key to significantly increasing solar energy development and building personal wealth in the process. Achieving 30% renewables by 2030 is not wishful thinking. By rallying behind SB230 and HB1467, we contribute to a brighter and cleaner future for Pennsylvania.
It’s time to put power over our energy back in the hands of the people.
If you need help finding/contacting your legislator, Legis has a handy guide that you can use here.
At Exact Solar, we don’t believe that solar power is a political issue. The economics of solar power speak for themselves. This isn’t about red vs. blue. This is about the people of Pennsylvania standing up to a stagnant power industry and demanding to walk into the future of energy with the rest of the country.
As a Pennsylvanian interested in solar energy, you can help us accelerate toward a brighter future and raise the price of Pennsylvania SRECS, making the power your solar system produces much more valuable.