On April 13, 2026, Governor Abigail Spanberger signed House Bill 628 into law1. This represents the first significant change in Virginia's solar energy market since the Virginia Clean Economy Act (VCEA) was first enacted in 2020. This article focuses primarily on how RPS program requirements for Virginia SRECs have increased, and how this may affect future credit prices for small distributed solar.
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Virginia HB 628: Virginia law now requires Phase II Utilities (Dominion Energy) to obtain 4.5% of all electricity it sells from small-scale distributed solar (less than 1 MW capacity). Under VCEA 2020, that requirement was only 1%; the demand for Virginia Distributed SRECs just increased by 4.5x.
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1. Virginia's Renewable Portfolio Standard
Virginia's RPS laws requires the state's largest electric utilities, Dominion Energy Virginia and Appalachian Power, to source a percentage of the electricity they sell to customers from renewable energy sources. By 2026, Dominion must source 29% of its electricity from renewables, rising to 100% by 2045 under the VCEA.
The way this system is tracked is through Renewable Energy Certificates, or RECs. Utilities must retire a certain number of RECs each year to prove that they’ve met the RPS requirements. Failure to purchase and retire RECs results in the State levying a tariff know as the Solar Alternative Compliance Payment (SACP).
Virginia's RPS includes a specific sub-requirement, called a carve-out, for distributed solar These Distributed RECs are tracked separately from large scale solar and out of state projects and carry a higher SACP penalty.
2. Two Key Changes
HB 628 makes three transformational changes:
BTM Carve-out 4.5× Expansion: Raises the mandatory behind-the-meter (BTM) Distributed REC carve-out from 1% to 4.5% of total retail electric sales for compliance years 2026 through 2030, and to 5% for compliance years 2031 through 2045.
Residential PPAs Unlocked: Explicitly authorizes residential customers in Dominion territory to purchase solar through Power Purchase Agreements (PPAs), a financing model previously restricted to low-income customers and commercial/government entities. PPAs eliminate upfront installation costs, dramatically lowering the barrier to residential solar. RECs are typically claimed by the PPA fund instead of end-user customer in this structure.
3. VA SREC Demand Forecast
To understand the pricing implications of HB 628, it is essential to compare the new mandatory demand for Distributed RECs against the current supply of eligible behind-the-meter solar in Virginia.
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Metric |
Value |
Notes |
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Dominion annual retail electric sales (2025) |
74 million MWh |
Dominion Energy Virginia annual report |
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BTM carve-out – (old, 1.00%) |
740k VA SRECs |
VCEA 2020 requirement
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BTM carve-out – (new, 4.50%) |
3.35m VA SRECs |
HB 628 requirement
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Incremental new demand |
+2.6m SRECs/yr |
Market Undersupply |
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SACP price ceiling (ey 2026) |
$78.82 / MWh |
Increases 1%/yr |
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Spot Price: VA SREC (ey 2026) |
$27.00 / MWh (05/07/2026) |
Prices may move toward SACP with increased demand |
Virginia's existing fleet of behind-the-meter solar can supply only about 30% of the new legal requirement. The market will remain undersupplied until more small solar projects are installed, increasing the available market REC supply. Prices for RECs may rise to reflect this supply shortage, and fall accordingly as more solar is interconnected in Virginia.
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MARKET VIEW: The 2026 VA Distributed REC SACP ceiling is $78.82/MWh. VA SRECs are trading at roughly 34% of the penalty ceiling. Given the 4.5× demand increase under HB 628 and existing supply covering less than half of the new requirement, Flett Exchange believes VA Distributed REC prices will trade between $65.00-$70.00 in the short term (EY 2026-2030). |
5.Flett Exchange: The best choice for selling Virginia RECs (Solar, Geothermal)
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Residential |
Commercial |
Installers |
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REC Manager Aggregator Scope of Services
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Commercial solar projects can sell their RECs on the spot market, or negotiate multi-year price lock contracts. Facilities greater than 500kw are eligible for our most competitive fee structure ($0.50-$2.00/REC) |
The Flett Exchange Installer Portal is a proprietary CRM that we built to help PPA Funds, Commercial Solar Portfolios, Residential Installers, and LMI Housing Authorities streaming the management and monetization of RECs from their renewable portfolios. |
Trade Virginia SRECs on Flett Exchange
Flett Exchange operates dedicated spot markets for both Virginia RECs and Virginia Distributed SRECs. Our platform allows residential and commercial solar owners, to trade RECs either using our full-service REC Manager platform, or as a trader with our Do-It-Yourself option.
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READY TO GET STARTED? Flett Exchange is the leading PJM REC Aggregator/Broker. Call or email the trading desk today to speak with a representative who can answer any of your questions related to Solar or Geothermal REC registration. info@flettexchange.com 201-209-0234 www.flettexchange.com |