Understanding Virginia's Two REC Classifications

Virginia's Renewable Portfolio Standard (RPS), established under the Virginia Clean Economy Act of 2020, created two Renewable Energy Certificate (REC) compliance categories tracked through the PJM Generation Attribute Tracking System (GATS).

Virginia RECs and Virginia Distributed RECs are separate designations with distinct eligibility criteria and market impacts for system owners, compliance buyers, and pricing dynamics.

1) Virginia REC

The Virginia RPS specifies eligible resource categories for renewable technologies, including solar, geothermal, wind, and biomass.1

Solar facilities located anywhere in the PJM region qualify as eligible resources, therefore RECs from these facilities are stamped with a "Renewable" tag. (Ex. VA-SUN-12345-SUN-I)

PJM Grid Map. Virginia, West Virginia, Maryland, DC, Delaware, Pennsylvania, and New Jersey are mostly or fully highlighted. Parts of North Carolina, Kentucky, Michigan, Ohio, and Tennessee are highlighted.

PJM consists of all or most of VA, WV, MD, DC, DE, PA, and NJ with some parts of NC, KY, MI, OH, and TN included as well.

Geothermal Heating and Cooling systems located within the Commonwealth also qualify for VA REC eligibility as of 01/2026. The Virginia State Corporation Commission (SCC) approved Revision 5 of the GATS business rules, outlining the certification requirements and affidavits for Geothermal systems.2 Flett Exchange helps Geothermal investors navigate PJM GATS registration. Learn More

The VA REC market is beneficial to Flett Exchange's customers because of its 5 year REC-life, and wide range of location eligibility for solar. Flett Exchange enables you to trade your RECs in the Virginia market if the system meets the following criteria:

  • PJM states without a defined RPS
  • Generators holding expired RECs in 3-year REC markets:
  • Pennsylvania - Solar, Tier I
  • New Jersey - Class I, TREC, SREC II
2) Virginia Distributed REC

The Virginia Distributed REC designation is a narrower classification designed to support in-state distributed solar development.

To qualify, a facility must:

  • Be a solar facility
  • Be located in Virginia
  • Have a capacity of 1 MW or less
  • Meet PJM GATS metering standards (including revenue-grade metering)
  • Apply for and receive the Distributed designation within GATS

Once approved, a “D” is appended to the facility's Virginia certification number in GATS (Ex. VA-SUN-12345-SUN-I-D), distinguishing it from standard Virginia RECs. This classification is commonly referred to in the market as Virginia SRECs and is most relevant to residential and small commercial solar systems.

Why the Distinction Matters

Under the Virginia Clean Economy Act, utilities such as Dominion Energy and Appalachian Power must procure both general RPS-eligible RECs and a specific portion from distributed solar generation, creating a separate demand pool.

In short, every Virginia Distributed REC qualifies as a Virginia REC, but not every Virginia REC qualifies as Distributed. The “D” designation unlocks access to the higher value Distributed REC market.

1 Virginia §56‑585.5 "Generation of electricity from renewable and zero‑carbon sources"

2 Business Rules for Issuing Virginia ("VA")-Approved Renewable Energy Certificates ("RECs") Revision 5 pursuant to Va. Code § 56-585.5 C

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