Hey Ohio! FirstEnergy Desperately Needs to Buy Your Rooftop Solar SRECs!

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Ohio utility FirstEnergy Corp claims it cannot meet the state mandates to get half of its 25% percent renewable electricity mandated by 2025, because there are not enough solar projects or credits within the state. Half the solar carve-out must come from in state.

When solar developers build solar projects in the state, or even homeowners in Ohio add solar panels to their own roofs, they can sell the credits to the utility (even if they use the power themselves) as Solar Renewable Energy Credits (SRECs).

But FirstEnergy says that there are not enough developers or homeowners offering solar credits to the utility to meet that mandate. So FirstEnergy has filed a request with the Ohio Public Utilities Commission to “declare a shortage of credits”. If they do, the mandate to get the power is vacated. It wants a SREC shortage declared by the Ohio PUC, which would let them off the hook.

Ohio must get 50% of its 25% mandated renewable electricity from solar projects or SRECs by the end of 2024. Half must come from inside the state.

Another Ohio utility has had no trouble finding the solar projects it needed to meet the mandate. American Electric Power has signed a power purchase agreement to buy all the power from a small local 12 MW solar array in Wyandot County, and has plans for getting a 500 MW project online by the deadline. So it does not need to buy SRECs.

FirstEnergy is not going the power purchase route. It is relying on SRECs. It claims that they could only find 125 SRECs, despite hiring a consultant. Of these, 85 come from solar developers, and 40 come from homeowners.

There are only 8 homeowners in Ohio making solar off their roofs and selling the 40 SRECs that they generate to FirstEnergy.

Each SREC represents 1 Megawatt-hour of electricity generated in a year. An average home array will generate about 4 to 8 megawatt-hours of renewable electricity a year, depending on how big your system is.

So a typical home solar array could generate 4 to 8 SRECs each year, and each SREC sells for $300 to $400 in Ohio,  so the annual passive income you could expect to generate off an average Ohio rooftop would be somewhere between $1,200 to $3,200 every year.

SREC earnings vary from state to state. New Jersey SREC earnings are the best.

Even though you sell your credits, of course, solar also cuts or eliminates your own utility bill, so the financial benefit is doubled in the states where you can sell SRECs to your utility.

The credits are just a piece of paper indicating that someone in that utility district is contributing clean power for the grid. Makes no difference who uses it. (Off-grid solar on your log cabin upstate would not qualify as a SREC, because it has to be on the public grid for everyone.)

How much does this Ohio utility need to buy?

In a filing this week with the PUCO, FirstEnergy said it is unable to find the 3,170 credits it needs to buy from in-state sources. This includes SRECs from homeowners and professional solar developers. It can also buy SRECs from Indiana, Kentucky, West Virginia, Pennsylvania or Michigan.

But half have to come from instate. That is where the Ohio shortage is acute. “And we are interested in talking to developers of any renewable energy project in Ohio that would generate credits toward meeting the state’s goals,” said spokeswoman Ellen Raines.

Image: Green Energy Ohio

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