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NJ solar, class I RECs lurch lower; Mass. solar prices weaken

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NJ solar, class I RECs lurch lower; Mass. solar prices weaken

Afterrecent strength, New Jersey solar renewable energy credit pricesrolled lower during the final week of March. Garden State energy year 2016SRECs posted an index at $285.06/MWh, losing more than $7 on the week.

NewJersey class I REC markets also dropped in value to round out the month ofMarch. Vintage 2016 class I RECs in the Garden State came in at an index of$13.54/MWh, down 20 cents from the week prior.

Tothe north, the Massachusetts solar I market for 2015 was eyed at an average of$462.08/MWh, dipping 8 cents, with 2016 pegged at $455.31/MWh, down $1.25 onthe week.

TheMassachusetts solar II market for 2015 came in at $272.50/MWh, also retreating$1.25, with 2016 eyed at an index of $270.00/MWh, losing $1.67 from the weekbefore.

Accordingto a recent post from SRECTrade, the Massachusetts SREC market has seen lessdemand for 2015 SREC-Is and IIs "as many compliance buyers have finalizedtheir needs for the year. As a result, bid activity has been less frequent andpricing has fallen."

OnApril 15, the last SRECs of calendar year 2015 will be issued in Massachusetts.All SREC retirements in the state need to be finalized by June 15. According toestimates from SRECTrade, it is possible that the Massachusetts SREC I 2015market could be slightly oversupplied.

"Thiswould be the case if all 2015 issued, 2014 banked, 2014 Solar CreditClearinghouse Auction (SCCA) re-minted, and 2013 SCCA re-minted SRECs were usedtowards 2015 compliance. Additionally, compliance entities would have to forgobanking any 2015 vintage SRECs for use in 2016 (i.e. up to 10% of thecompliance obligation can be banked for future use)," SRECTrade wrote.

However,it is also possible the Massachusetts SREC market could be undersupplied for2015, the analysts noted.

"Thiswould be the case if not all of the 2014 banked, 2014 SCCA re-minted, and 2013SCCA re-minted SRECs were used towards 2015 compliance, but some were carriedforward for 2016 compliance. This is certainly a possibility as many complianceentities may have purchased 2013 and/or 2014 SCCA SRECs with the intention ofusing them towards compliance in 2015 and/or 2016. Since the SCCA SRECs couldbe purchased at a fixed price of $300, it would have been advantageous for acompliance buyer to buy the less expensive SRECs in the SCCA versus paying 2015or 2016 market prices."

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CSAPR emissions indicationsend March on mixed note

Priceindications for NOx and SO2 emissions under the Cross-State Air Pollution Rulewere mixed to conclude the month of March. CSAPR seasonal NOx allowances for2016 were eyed in a bid-and-ask range of $220 to $290, compared to a level of$210 to $280 the week prior. CSAPR annual NOx allowances for 2016 were markedin a bid-and-offer range of $40 to $80 during the period under review, easingfrom $60 to $95 a week ago.

CSAPR2016 SO2 Group 1 allowances remained at a bid-and-offer level of $1 to $5,while CSAPR 2016 SO2 Group 2 allowances were heard in a bid-and-ask spread of$2 to $7.50 during the final week of March, compared to a range of $3 to $7 theweek before.

TheCSAPR was designed to curb power plant emissions of nitrogen oxide and sulfurdioxide that degrade air quality in downwind states and impede the ability ofthose states to meet standards set for fine particulate matter and ground-levelozone. The CSAPR was also designed to establish a cap-and-trade program forstates to cut power plant pollution.

Market prices and includedindustry data are current as of the time of publication and are subject tochange. For more detailed market data, including power,naturalgas, and coalindex prices, as well as forwardsand futures,visit our Commodities Pages.