Prices for spot New Jersey Solar Renewable Energy Certificates SREC have slid in trading on the Flett Exchange in the past 2 days as solar owners scramble to lock in prices. The Friday, July 1, 2011 settlement price was $609.93 which is a $18.15 drop on the back of a $12.87 drop the previous day.There has been record heavy volume on the exchange due to the minting of the last of the energy year 2011 SRECs on GATS on June 30th. This is the lowest price since July of 2010 and is 7% lower than the $655 settlement price which sellers achieved on Flett for the majority of the year. The current bid on the trading platform is $600 for a few hundred SRECs with buyers posting bids on the trading platform in a scale down fashion.
Since the minting of the SRECs at 8am on June 30th Flett Exchange customers have sold SRECs starting at $637.50. Buyers have participated at virtually every level (every $2.50 for hundreds of SRECs) on the Flett trading platform giving sellers a chance to lock in prices, transfer SRECs and get paid. (All Flett Exchange managed SREC clients were locked in at $645! as we took precautionary measures and locked in prices early as opposed to waiting to the 3rd business day) Flett Exchange is the only company to provide the SREC markets with real time execution services and transparency. (Flett Exchange is neutral and does not make money as an aggregator does with offering lower prices to sellers)
The New Jersey SREC market is experiencing a pivotal change on the back of unexpected solar development in the Garden State. In past years there has not been hardly enough solar to meet State mandates. Hence, SREC prices have been hoovering near the fine levels. Going into the close of the 2011 energy year (it ended in May 2011) there is estimated to be only a slight shortage of SRECs to meet state needs compared to large shortages in previous years. Inexperienced market analysts have predicted market prices to remain high for the balance of energy year 2011 SRECs which underestimates the risk to sellers. There are a variety of different factors that will come into play during the next 2 months as the remaining compliance buyers pick up their last SRECs. As they finish and prepare their compliance filings, the energy year 2011 SRECs will converge and trade at an expected $20 discount to the energy year 2012 SRECs. At current levels that puts the EY 2011 SRECs in the mid $300s by October 1st. This significant price difference between energy years has created a liability for buyers because if they overbuy SRECs they will loose over $200 if they need to use them for next years compliance.
The specter of the possibility of failed auctions in the coming month has many flocking to the Flett Exchange market to lock in prices. There is a record volume auction of the Load Serving Entities SRECs on July 12 of over 30,000 SRECs. This is 10% of the whole years production in one sale. The auction is run by NERA consulting. A large auction into a relatively balanced market, at the end of an energy year, with most LSE’s estimated to be close to finished with compliance buying runs a high risk of clearing at low prices compared to the current spot price. (A failed auction can occure when the sellers choose too high of a reserve price or when there fails to be enough buyers to clear the total volume) There is a slight possibility that the auctions will clear at stable to high prices.
Flett Exchange customers can log on 24 hours a day to sell SRECs on our transparent and competitive Internet trading platform to sell their SRECs, call our trading desk during normal business hours 201 209 0234, or email us at firstname.lastname@example.org.
(DON’T TRANSFER SRECS ON GATS AT THE PREVIOUS DAYS SETTLEMENT PRICE AND EXPECT TO GET FILLED THERE. WE CAN ONLY TRANSACT AT THE PRICES AVAILABLE IN REAL TIME)
More on Flett Exchange:
Flett Exchange is largest volume SREC exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Over 3,000 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs in a secure and seamless online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers (its simple sell a SREC and receive a check!) Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, CT, MA, and DC and supported by trained solar professionals with specialized knowledge and proven experience.
Flett Exchange brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services.