In 2012, Ohio Senator Kris Jordan introduced a bill to repeal Ohio’s Renewable Energy Portfolio Standard. After the bill failed to advance in the 2012 session, Senator Jordan introduced a similar bill, Senate Bill (SB) 34, in February 2013. The bill has been referred to the Public Utilities Committee, but a hearing has yet to be scheduled.
If passed, SB 34 would amend several sections of the state’s Renewable Energy Portfolio Standard (RPS). Most importantly, SB 34 would repeal the requirement that utilities must reach a goal of 25% of electricity sales from renewable and advanced energy resources by 2025. In effect, this would remove the 0.5% solar carve-out and terminate the necessity for a solar renewable energy credit (SREC) market in Ohio, as well as seriously affect adjacent states that sell their SRECs into Ohio’s borders.
Senator Jordan has pushed to repeal the RPS because he believes that the requirements will increase electricity costs for residential and commercial customers without much environmental and economic benefit. However, historical data shows that Senator Jordan’s assumptions may be inaccurate, and ratepayer costs have been minimal over time. Furthermore, the current Ohio RPS has a protection for the ratepayer already built-in, as the utility will not be mandated to comply with these standards should electric rates increase by more than 3%.
If anything, the Ohio SREC market is in need of a bill that would increase the solar carve-out requirement, and thus the demand for solar in the state, to revitalize the struggling SREC market. The Ohio SREC market in 2013 is projected to be two times oversupplied with an expected 120,000 SRECs to be issued in 2013 compared to a demand of only 60,000 SRECs. This oversupply is likely to continue into the 2014, 2015, and 2016 compliance years. Ohio SRECs are currently trading below $50.
Sol Systems currently offers three types of SREC aggrements for Ohio solar systems: Sol Annuity, Sol Brokerage, and Sol Upfront. Please email firstname.lastname@example.org or contact your solar installer for more specific pricing.
About Sol Systems
Sol Systems is a boutique financial services firm that offers investor clients direct access to the renewable energy asset class and provides developers with sophisticated project financing solutions. Founded in 2008, Sol Systems focuses on meeting the most critical needs of the industry, including SREC monetization, capital placement, tax equity, and New Market Tax Credits. To date, the company has arranged financing for thousands of projects and facilitated hundreds of millions in investment on behalf of Fortune 100 companies, private equity, family offices and individuals.
For more information, please visit www.solsystemscompany.com.