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Tesla now keeps all the SRECs [SREC = Solar Renewable Energy Credits]

mdsolar

New Member
Jan 12, 2021
3
0
Maryland
Recently got a solar quote from Tesla for a 8.16 kW system + 2 Powerwalls . Disappointed to learn that they now keep all the solar renewable energy credits (SRECs) and do not allow the owner to retain them, which some customers in this forum were able to do in earlier threads. The price Tesla pays for your SRECs is a lot less than their worth over time.
 

rsunny2012

Member
Aug 14, 2018
61
19
CA
what is SREC ? . i have got the quote last year april. Tesla is installing solar next month. where do i see SREc related in my contract ?
 

mdsolar

New Member
Jan 12, 2021
3
0
Maryland
Renewable Energy Credits that your solar install generates. You get one credit for every 1 MW that it generates. These can be sold to utilities at various prices depending on the state.
 

TacC

Member
Jun 2, 2016
195
100
East Bay, CA
Recently got a solar quote from Tesla for a 8.16 kW system + 2 Powerwalls . Disappointed to learn that they now keep all the solar renewable energy credits (SRECs) and do not allow the owner to retain them, which some customers in this forum were able to do in earlier threads. The price Tesla pays for your SRECs is a lot less than their worth over time.
Is this for the subscription only? Or for upfront purchases, as well?
 

glide

Active Member
Jun 6, 2018
2,881
2,901
USA
Recently got a solar quote from Tesla for a 8.16 kW system + 2 Powerwalls . Disappointed to learn that they now keep all the solar renewable energy credits (SRECs) and do not allow the owner to retain them, which some customers in this forum were able to do in earlier threads. The price Tesla pays for your SRECs is a lot less than their worth over time.
That was not the case for my recent installation agreement. Must be based on where you live.
 

wjgjr

Active Member
May 11, 2020
1,177
919
Silver Spring, MD
Sorry to hear that they have removed that option - it is essentially a price hike on people in MD and other states with SREC programs. I would guess it is a combination of profit motive and them trying to take control of all paperwork as they now also seem to file for at least the MD solar credit on your behalf. They may have found it was actually easier for them just to submit everything than to support customers in doing so.

For those curious, SRECTrade | SREC Markets shows a map of states they support with SREC markets. It is only a small number - IL, OH, PA, MA, NJ, DE, MD, and DC. And, as I understand it, IL, MA, NJ, and DE at least have transitioned away from traditional SRECs for new installs. OH does apparently allow neighboring states to participate, though it also pays very little for credits.
 

SolPowered

Member
Aug 25, 2020
18
1
Connecticut
Sorry to hear that they have removed that option - it is essentially a price hike on people in MD and other states with SREC programs. I would guess it is a combination of profit motive and them trying to take control of all paperwork as they now also seem to file for at least the MD solar credit on your behalf. They may have found it was actually easier for them just to submit everything than to support customers in doing so.

For those curious, SRECTrade | SREC Markets shows a map of states they support with SREC markets. It is only a small number - IL, OH, PA, MA, NJ, DE, MD, and DC. And, as I understand it, IL, MA, NJ, and DE at least have transitioned away from traditional SRECs for new installs. OH does apparently allow neighboring states to participate, though it also pays very little for credits.

The Mass market allows neighboring states as well - I'm in CT and trying to get my SRECs back from Tesla, but it hasn't been granted yet. I've asked two project advisors going back to August about it and haven't gotten traction. I believe when I'd looked, it seemed like it'd be two years to match Tesla's credit, and then everything after that was a gain, so it's well worth it to me to get those credits back.
 

willow_hiller

Active Member
Apr 3, 2019
3,098
14,295
Maryland
I've seen a couple of posts about this on Reddit as well. It does seem like it is Tesla's new policy to only proceed with projects where people are willing to sell their future SRECs for an upfront discount.

All I can think is that Tesla crunched the numbers and figured out they couldn't continue installing at $2.01/watt before incentives without buying the SRECs.

As others have said, the SRECs are often worth more than Tesla is willing to pay for them; but on the bright side, at least it gives Tesla a financial incentive to quickly honor warranty repairs.
 

wjgjr

Active Member
May 11, 2020
1,177
919
Silver Spring, MD
The Mass market allows neighboring states as well - I'm in CT and trying to get my SRECs back from Tesla, but it hasn't been granted yet. I've asked two project advisors going back to August about it and haven't gotten traction. I believe when I'd looked, it seemed like it'd be two years to match Tesla's credit, and then everything after that was a gain, so it's well worth it to me to get those credits back.
Got it - wasn't listed on the SRECTrade page for the MA SREC or newer AEC (which is what I assume you are applying to since the MA SREC program closed a bit back.) I had only seen mention that CT utilities might pay you for credits.

It looks like the MA program is still a spot pricing, like MD has. It seems like the newest trend (like in IL and NJ) is selling your entire set of credits for a long period - like 15 years. It will be interesting to see if other SREC states follow that trend - my understanding is part of the reason to change is to provide some price certainty and make the process easier than the current process of selling them as you go.
 

Silicon Desert

Active Member
Oct 1, 2018
3,314
3,025
Sparks Nevada / GF 1
Out of curiosity, does Tesla also want to get your federal or state tax credits (for folks that are able to get state credits)? I remember a few years ago when I was researching to put solar on the home that SolarCity had it in their ridiculous 37 page contract that they would get the tax credits. Obviously I went with another company and bought the system outright, so just curious how that has changed. Inquiring neighbors want to know.
 

wjgjr

Active Member
May 11, 2020
1,177
919
Silver Spring, MD
I've seen a couple of posts about this on Reddit as well. It does seem like it is Tesla's new policy to only proceed with projects where people are willing to sell their future SRECs for an upfront discount.

All I can think is that Tesla crunched the numbers and figured out they couldn't continue installing at $2.01/watt before incentives without buying the SRECs.

As others have said, the SRECs are often worth more than Tesla is willing to pay for them; but on the bright side, at least it gives Tesla a financial incentive to quickly honor warranty repairs.
I'm not sure that it is just about Tesla deciding they couldn't install without the credits, since it really only affects a few states - right now, I think DC, IL, NJ, and MD might be the only states with notable SREC incentives (PA, OH, and MA all appear to be under $25/SREC-equivalent.) I am sure they are happy to make a few more bucks with these offers, but if they can continue to install in places like CA without (as I understand it) any SREC or other ways to pad the numbers, I would think they can still afford to do so in MD. As much as anything, it streamlines the process by removing interaction with customers who need to get info from Tesla to complete applications.

I would also be interested to hear from OP what Tesla is now offering for a credit in MD, since the present lifetime value of buying out the credits is under $400/MWh (probably closer to $350, depending on inflation assumptions) and will drop to under $300 by the end of 2021.
 
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willow_hiller

Active Member
Apr 3, 2019
3,098
14,295
Maryland
Out of curiosity, does Tesla also want to get your federal or state tax credits (for folks that are able to get state credits)?

In Maryland we qualify for a $1,000 state grant; Tesla didn't try and take it for a purchased system, and they actually help fill out the paperwork to apply for it too.

Federal Tax Credit depends on whether you get a loan or not, but it's all with third parties (either Mosaic or Sunlight Financial). They give you a low monthly payment to start, and in order to keep the monthly payment you're expected to put 26% down within 18 months.
 
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Silicon Desert

Active Member
Oct 1, 2018
3,314
3,025
Sparks Nevada / GF 1
In Maryland we qualify for a $1,000 state grant; Tesla didn't try and take it for a purchased system, and they actually help fill out the paperwork to apply for it too.

Federal Tax Credit depends on whether you get a loan or not, but it's all with third parties (either Mosaic or Sunlight Financial). They give you a low monthly payment to start, and in order to keep the monthly payment you're expected to put 26% down within 18 months.
Good to know. Yet as for financing, there are a couple companies out here that do direct financing and the CPA said "If I finance it through the seller, then I can claim the federal credit for the full cost of the system." BUT, I wasn't interested in financing anyway.
 

SolPowered

Member
Aug 25, 2020
18
1
Connecticut
Got it - wasn't listed on the SRECTrade page for the MA SREC or newer AEC (which is what I assume you are applying to since the MA SREC program closed a bit back.) I had only seen mention that CT utilities might pay you for credits.

It looks like the MA program is still a spot pricing, like MD has. It seems like the newest trend (like in IL and NJ) is selling your entire set of credits for a long period - like 15 years. It will be interesting to see if other SREC states follow that trend - my understanding is part of the reason to change is to provide some price certainty and make the process easier than the current process of selling them as you go.

I was looking at the Class 1 RECs for New England - SRECTrade | REC Markets | Massachusetts Class I | MA
 

wjgjr

Active Member
May 11, 2020
1,177
919
Silver Spring, MD
In Maryland we qualify for a $1,000 state grant; Tesla didn't try and take it for a purchased system, and they actually help fill out the paperwork to apply for it too.

Federal Tax Credit depends on whether you get a loan or not, but it's all with third parties (either Mosaic or Sunlight Financial). They give you a low monthly payment to start, and in order to keep the monthly payment you're expected to put 26% down within 18 months.
Yeah - unless this changes, my impression has been that Tesla does not generally want to claim the tax credits - they get their money now and then you get yours back from the government later. But, they do list the various credits in the pricing they advertise, so it is always important to review to understand what will be due with the contact and what will come back later. Additionally, Tesla generally won't guarantee any credit, so it is not their problem if for some reason you fail to qualify or the program runs out of money.

It is a great improvement though that, as you mention, they are now filing the $1k grant application for you. For OP, it would be cool if they also started filing for the MD $5k energy storage tax credit as well, but they still seem not to list that on their website.

And, in answer to my own question about what Tesla is offering for SREC purchase, it looks like with online ordering, Tesla is offering a credit of $694 for each set of 12 panels, or about $170 per installed kW. Since the number of MWh generated annually per installed kW can vary, it is not a simple answer, but it for most people, it seems like each kW generates more than one MWh annually, which means that, even inflation-adjusted, Tesla seems to be offering under 50% of the value of the SRECs, which seems to be a pretty poor deal.
 
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VT_EE

Active Member
Apr 22, 2017
2,025
2,422
Maryland
SREC values vary wildly. Prior to last year, they were pretty much worthless in MD (~$10 each). As more solar comes online, the value of the SREC goes down. I believe they jumped in value last year when MD passed a new law requiring higher % of renewable energy. However, the value has been decreasing since.
 

wjgjr

Active Member
May 11, 2020
1,177
919
Silver Spring, MD
SREC values vary wildly. Prior to last year, they were pretty much worthless in MD (~$10 each). As more solar comes online, the value of the SREC goes down. I believe they jumped in value last year when MD passed a new law requiring higher % of renewable energy. However, the value has been decreasing since.
Yeah, there was a big boost in 2019 with the change to the renewable portfolio standard (RPS) for the state, and the value has actually held pretty well since (SRECTrade lists $80 as the latest value for 2020 credits, which is close to the year high of $85, and 2019 credits are also much improved from the teens in early 2019 to around $70 now.) The problem for those of us with SRECs in MD is that the Alternative Compliance Payments (ACP) are dropping. It was $100 last year but is $80 this year and $60 next year (eventually dropping to the low $20's by 2030, when the program ends.) Since utilities pay the ACP amount if they fail to meet the RPS through building their own facilities or buying SRECs, the value of SRECs is effectively capped by the ACP. So it is almost certain that prices will drop below $80 and continue to do so into the future.

And, as it relates to what Tesla is offering, it is fair to note that Tesla is now assuming the risk that prices fall well below the ACP like they were a few years ago, which could account for part of the reduced offer.
 

SaveOurPlanet

Member
Jan 6, 2018
213
129
San Francisco
My roof install is scheduled for next month but I saw that there is Solar Renewable Energy Credit for 4 major CA utilities now, PG&E, SCE, SDGE and GPSD. I asked my project advisor about that and I got a new Purchase Agreement to e-Sign, with it there is a $389.00 line item credit from the system cost so my purchase price is reduced by that amount. Not a meaningful amount but I also did not expect it.
 

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