pa, nj, and md solar rec update may 19, 2015 · source: pjm gats, srectrade estimates, and eia...

PA, NJ, and MDSolar REC Update

MAY 19, 2015

AGENDA

• SRECTrade Company Overview

• Pennsylvania, New Jersey, and Maryland

• Installed Solar Capacity

• Supply and Demand

• Pricing

• Q&A

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manufacture, use, or sell anything that it may describe, in whole or in part. If consent to use these materials is granted, a link to the current version of

this document on the SRECTrade website must be included for reference.2

TRANSACTION & MANAGEMENT PLATFORM

• Since 2008

• 160+ MW under management

• 12,000+ facilities under management

• 100% SREC focused

• Brokerage model

3

BROKERAGE

Spot transactions

Structured forward solutions

SOFTWARE

Onboarding with regulators &

registries

Tracking production & SRECs issued

Executing & settling SREC

transactions

PRODUCTS & SERVICES

4

PA SOLAR CAPACITY INSTALLED

Capacity in PJM GATS (5/12/15) = 389.6 MW (ex. DC, MD, NJ)

EY 2015:

0.144% Solar required

$188.79 SACP (EY14)

Estimated SRECs Req.

~213.6k SRECs

Estimated Avg. Annual

MW Balance Needed*

~178.0 MW (not including

older vintages)


EY2016: ~374.5k

EY2017: ~443.8kSource: PJM GATS, SRECTrade Estimates, and EIA Report “Retail Sales of Electricity” 5

-

50.0

100.0

150.0

200.0

250.0

300.0

350.0

400.0

PA In-State Total PA2013 MW Req.

PA 2014 MW Req. PA 2015 MW Req.

PA SOLAR BUILD RATES (MW)

All recent build driven by NC sited; 6 projects across 84.5 MW online in Dec-2014

• Q1 2015 build rates down

• LTM average MW/month Ex-NC = 821 kW/Month

Source: PJM GATS; note LTM and LSM data through March 2015 6

7.9

14.9

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

Last 12 Months Avg.MW/Month


88.9%

increase

88.1

1.10.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

90.0

100.0

3 Months EndingDec 2014

3 Months EndingMarch 2015

98.7% decrease

1.1

PA SREC SUPPLY AND FORECAST

Through April 2015 Issuance

• 340.5k EY2013 and EY2014 SRECs remain

• 305.6k EY2015 SRECs have been issued

• Forecast another 89.9k EY2015 SRECs

• At current build, estimated EY2015 oversupply

522.4k SRECs

Source: PJM GATS and SRECTrade Estimates. April 2015 issuance includes generation through March 2015. 7

340,476

305,623

89,898

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

2015Forecast EY2015

Existing EY2015

Existing EY2013 & EY2014

PA2015 SRECs

Req.

PA ELECTRICITY SALES (MWh) AND SRECs REQUIRED

Recent years have been relatively flat; 2013 = 146.3 mm MWh

Source: SRECTrade Estimates and EIA Report “Retail Sales of Electricity” 8

SRECs Required (in 000s)

YearRPS

Solar %

0%

Growth

1.0%

GrowthDiff.

2015 0.14% 211.5 213.6 2.1

2016 0.25% 367.2 374.5 7.4

2017 0.29% 430.7 443.8 13.1

2018 0.34% 499.3 519.6 20.3

2019 0.39% 572.8 602.0 29.2 140.0

142.0

144.0

146.0

148.0

150.0

2009 2010 2011 2012 2013

Electricity Sales (MWh in millions)

PA SUPPLY / DEMAND SCENARIOS – ELECTRICITY SALES REMAIN FLAT

Source: SRECTrade Estimates.

Oversupply persists with various degrees of build

Overs

up

plie

d

9

-

400,000

800,000

1,200,000

1,600,000

2,000,000

2015 2016 2017 2018 2019 2020

Case 1 - 2.0 MW/month Case 2 - 3.9 MW/month Case 3 - 7.9 MW/month

-

400,000

800,000

1,200,000

1,600,000

2,000,000

2015 2016 2017 2018 2019 2020


PA SUPPLY / DEMAND SCENARIOS – ELECTRICITY SALES GROW 1.0%

Reduced oversupply with increased electricity sales

Source: SRECTrade Estimates. 10

Overs

up

plie

d

PA 2015 MARKET PRICING

Recent transactions have declined

Current PA15 market: $30.00 @ $38.00

Source: SRECTrade. 11

-

10

20

30

40

50

60

70

80

Ma

r-1

4

Apr-

14

Ma

y-1

4

Ju

n-1

4

Jul-14

Au

g-1

4

Se

p-1

4

Oct-

14

No

v-1

4

De

c-1

4

Jan-1

5

Fe

b-1

5

Ma

r-1

5

Ap

r-1

5

Ma

y-1

5

Bid Offer

NJ SOLAR CAPACITY INSTALLED

Preliminary Installed Capacity as of 4/30/15= 1,478.8 MW EY2015:


$331 SACP


~1.9 mm SRECs


MW Balance Needed*

~1,577.8 MW (not includin

g older vintages)


EY2016: ~2.1mm

EY2017: ~2.4mm

Source: New Jersey Office of Clean Energy, SRECTrade Estimates, and EIA Report “Retail Sales of Electricity”

-

200.0

400.0

600.0

800.0

1,000.0

1,200.0

1,400.0

1,600.0

1,800.0

NJ OCE MW Installed NJ2013 Est. MW Required

NJ2014 Est. MW Required NJ2015 Est. MW Required

12

NJ SOLAR BUILD RATES (MW)

Last six month average MW/month has increased. Last 3 months build rates are down.

Source: New Jersey Office of Clean Energy.

17.2 18.9

0.0

10.0

20.0

30.0

40.0



9.9% increase

73.2

39.9

0.0

10.0

20.0

30.0

40.0

50.0

60.0

70.0

80.0

3 Months EndingJan 2015

3 Months EndingApril 2015

45.5% decrease

13

NJ SREC SUPPLY AND FORECAST


• 585.7k EY2013 and EY2014 SRECs remain

• 1.1mm EY2015 SRECs have been issued

• Forecast another 336.5k EY2015 SRECs

• At current build, estimated EY2015 oversupply

190.5k SRECs

Source: PJM GATS and SRECTrade Estimates. April 2015 issuance includes generation through March 2015.

585,726

1,142,898

336,452

-

400,000

800,000

1,200,000

1,600,000

2,000,000

2,400,000

2015EY2015 Forecast

Issued EY2015

Existing EY2013 & EY2014

NJ2015 SRECs

Req.

14

NJ ELECTRICITY SALES (MWh) AND SRECs REQUIRED

Recent years have declined or are flat; EY2014 = 76.5 mm MWh

Source: New Jersey Office of Clean Energy and SRECTrade Estimates.


YearRPS

Solar %

0%

Growth

1.0%

GrowthDiff. SACP

2015 2.45% 1,874.6 1,893.3 18.7 $ 331

2016 2.75% 2,104.1 2,146.4 42.3 $ 323

2017 3.00% 2,295.4 2,364.9 69.6 $ 315

2018 3.20% 2,448.4 2,547.8 99.4 $ 308

2019 3.29% 2,517.3 2,645.7 128.4 $ 300

2020 3.38% 2,586.1 2,745.2 159.1 $ 293 75.0

77.0

79.0

81.0

83.0

85.0

EY10 EY11 EY12 EY13 EY14


15

NJ SUPPLY / DEMAND SCENARIOS – ELECTRICITY SALES REMAIN FLATO

vers

up

plie

dU

nd

ers

up

plie

d

Source: SRECTrade Estimates

Existing and lower build rates result in market flat / under supplied through EY2018

(400,000)

-

400,000

800,000

1,200,000

1,600,000

2,000,000

2,400,000

2015 2016 2017 2018 2019 2020


16

NJ SUPPLY / DEMAND SCENARIOS – ELECTRICITY SALES GROW 1. 0%

Existing and lower build rates result in greater undersupply beginning EY2016

Overs

up

plie

dU

nd

ers

up

plie

d

Source: SRECTrade Estimates

(400,000)

-

400,000

800,000

1,200,000

1,600,000

2015 2016 2017 2018 2019 2020


17

NJ2015 MARKET PRICING

Recent spot transactions are back up

Current NJ15 market: $217.50 @ $225.00

Source: SRECTrade

-

50

100

150

200

250

Oct-

13

Nov-1

3

Dec-1

3

Jan-1

4

Fe

b-1

4M

ar-

14

Apr-

14

May-1

4

Jun-1

4

Jul-

14

Aug-1

4

Sep-1

4

Oct-

14

Nov-1

4

Dec-1

4

Jan-1

5

Fe

b-1

5M

ar-

15

Ap

r-15

May-1

5

Bid Offer18

NJ 3 YEAR FORWARD MARKET

Forward market for NJ15-17 back to BGS levels

Current NJ15-17 market: $210.00 @ $220.00

Source: SRECTrade

-

50

100

150

200

250

Oct-

13

No

v-1

3

De

c-1

3

Ja

n-1

4

Fe

b-1

4

Ma

r-1

4

Ap

r-1

4

Ma

y-1

4

Ju

n-1

4

Jul-14

Au

g-1

4

Se

p-1

4

Oct-

14

No

v-1

4

De

c-1

4

Ja

n-1

5

Fe

b-1

5

Ma

r-1

5

Apr-

15

Ma

y-1

5

Bid Offer19

MD SOLAR CAPACITY INSTALLED

Capacity in PJM GATS (5/16/15) = 262.2 MW CY2015:


$350 SACP


~315.7k SRECs


MW Balance Needed*

~263.1 MW (not including

older vintages)


CY2016: ~446.4k

CY2017: ~611.9k

Source: PJM GATS, SRECTrade Estimates, and EIA Report “Retail Sales of Electricity” 20

40.0

80.0

120.0

160.0

200.0

240.0

280.0

MD2012 Est. MW Req. MD2013 Est. MW Req.

MD2014 Est. MW Req. MD2015 Est. MW Req.

MD SOLAR BUILD RATES (MW)

Last six month average MW/month has increased. Q1 2015 build rates are down.

Source: PJM GATS and SRECTrade Estimates; note LTM and LSM data through April 2015 21

5.8

7.0

5.2

5.4

5.6

5.8

6.0

6.2

6.4

6.6

6.8

7.0

7.2



19.3%

increase

26.7

16.2

0.0

10.0

20.0

30.0

3 Months EndingDec 2014

3 Months EndingMarch 2015

39.4% decrease

MD SREC SUPPLY AND FORECAST


• 84.6k CY2013 and CY2014 SRECs remain

• 50.5k CY2015 SRECs have been issued

• Forecast another 261.6k CY2015 SRECs

• At current build, estimated CY2015 oversupply

80.9k SRECs

Source: PJM GATS and SRECTrade Estimates. April 2015 issuance includes generation through March 2015.

Note: Assumes 2013 and 2014 Mount St. Mary’s (MSM) SRECs are withheld from the market entirely. 22

84,604

50,464

261,582

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

2015MD2015 ForecastIssued MD2015Existing MD2013 and MD2014

MD2015 SRECs

Req.

MD ELECTRICITY SALES (MWh) AND SRECs REQUIRED

Recent years have declined or are flat; 2013 = 61.9 mm MWh

Source: SRECTrade Estimates and EIA Report “Retail Sales of Electricity” 23

60.0

62.0

64.0

66.0

68.0

70.0

2009 2010 2011 2012 2013



YearRPS

Solar %

0%

Growth

1.0%

GrowthDiff. SACP

2015 0.50% 309.5 315.7 6.2 $ 350

2016 0.70% 433.3 446.4 13.1 $ 350

2017 0.95% 588.0 611.9 23.9 $ 200

2018 1.40% 866.6 910.8 44.2 $ 200

2019 1.75% 1,083.2 1,149.9 66.6 $ 150

MD SUPPLY / DEMAND SCENARIOS – ELECTRICITY SALES REMAIN FLAT

Source: SRECTrade Estimates. Assumes MSM begins selling 2015+ vintages.

Slight oversupply, ~10-30%, in 2015 & 2016, flat / undersupplied onward

Overs

up

plie

dU

nd

ers

up

plie

d

24

(600,000)

(500,000)

(400,000)

(300,000)

(200,000)

(100,000)

-

100,000

200,000

2015 2016 2017 2018 2019

SR

EC

s


MD SUPPLY / DEMAND SCENARIOS – ELECTRICITY SALES GROW 1.0%

Growth in electricity sales increases undersupply in future years

Overs

up

plie

dU

nd

ers

up

plie

d

Source: SRECTrade Estimates. Assumes MSM begins selling 2015+ vintages. 25

(600,000)

(500,000)

(400,000)

(300,000)

(200,000)

(100,000)

-

100,000

200,000

2015 2016 2017 2018 2019

SR

EC

s


MD2015 MARKET PRICING

Recent transactions have increased

Current MD15 market: $170.00 @ $180.00

Source: SRECTrade 26

-

40

80

120

160

200

Jul-14

Aug-1

4

Sep-1

4

Oct-

14

Nov-1

4

Dec-1

4

Jan-1

5

Fe

b-1

5

Mar-

15

Apr-

15

Bid Offer

MD 3 YEAR FORWARD MARKET

MD15-17 market has followed the prompt year

Current MD15-17 market: $160.00 @ $170.00

Source: SRECTrade 27

-

40

80

120

160

200

Oct-

14

No

v-1

4

De

c-1

4

Ja

n-1

5

Fe

b-1

5

Ma

r-1

5

Apr-

15

Bid Offer

Q&A

Steven Eisenberg

SRECTrade, Inc.

201 California St. Suite 630

San Francisco, CA 94111

P: (415) 702-0863

[email protected]

www.srectrade.com

16

pa, nj, and md solar rec update may 19, 2015 · source: pjm gats, srectrade estimates, and eia...

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