Solar manufacturer SunPower Corp. (Nasdaq: SPWRA) announced an agreement to sell New Jersey Solar Renewable Energy Certificates (NJ SRECs) to PPL Corporation (NYSE: PPL) over the next ten years.
The agreement is a result of changes to New Jersey’s solar power incentive program, which has transitioned this year from reliance on state rebates or grants to a market-based system relying primarily on SRECs.
Under the agreement, PPL EnergyPlus will purchase SRECs issued as a result of solar power generated at SunPower installations in the state. SunPower expects to use revenue from the sale of the SREC’s to finance the construction of approximately 2.5 megawatts (MW) of new solar power projects in New Jersey by 2010.
SRECs are tradable certificates representing all the renewable energy benefits generated from a solar electric system. Each time a solar system generates one megawatt hour of electricity, an SREC is issued that can then be sold or traded.
"Under New Jersey’s new program, SREC prices and terms of sale are being determined by the free market," said Tom Leyden, managing director of SunPower’s Trenton office. "We expect that more of New Jersey’s electricity suppliers will follow suit with similar long-term SREC purchase agreements."
"Combining the advantages of competitive markets with extended federal incentives for projects that support renewable energy and energy sustainability, that’s a winning formula," said Gene Alessandrini, senior vice president-marketing for PPL EnergyPlus. "It’s good business for PPL because it builds our renewable energy portfolio and advances the production of renewable, green energy."
New Jersey is one of the fastest growing solar energy markets in the U.S., with more than 3,500 solar power installations representing more than 69 MW of installed capacity.
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