Thanks to an organized effort, H.4185 has been tabled for now.  The people have spoken and the legislature listened!  Thank you for signing the letter for MA Advocates for Solar Growth and calling and emailing your legislators!

On July 31, there was an amendment on S2214 which raised the Net Metering cap 1% in Private and 2% in Public sectors. This will allow the backlog of solar projects to move forward at least until the end of the year.

The Amendment also sets up a 17 member commission to convene on October 1, 2014 and report to the legislature on March 31, 2015 on a study on solar PV in the Commonwealth.  Hopefully this commission will now be focused on keeping the Commonwealth moving towards an equitable and democratic solution for all.

Thank your legislator representative and senator.

Thank you again and we’ll keep you updated since the process is now openly evaluated.

The  MA Department of Energy Resources announced the results of the 2013 Solar Credit Clearinghouse Auction. The auction cleared in the third round. Depositors will receive $285 for every SREC deposited into the auction and we expect to receive payment by the end of August. We will process our customers’ payments as soon as they are received.  To check your account, login into the Knollwood Energy Customer Portal.

More information regarding the auction can be found here, http://www.mass.gov/eea/energy-utilities-clean-tech/renewable-energy/solar/rps-solar-carve-out/solar-credit-clearinghouse-auction.html.

What started as legislative bills to address the net metering cap has turned into proposed legislation which does address the net metering cap but also eliminates the current MA solar incentive program.  The timing of this compromised proposed legislation is occurring at a rapid speed (see dates below).

We are spearheading the group MA Advocates for Solar Growth.   To view our position and help us present a unified voice, click on this link, and sign the letter by 8:00am Wednesday June 18th.  We will submit this letter with all of the signatures to the Joint Committee on Telecommunications Utilities and Energy, House Committee on Ways and Means and the House Committee on Global Warming and Climate Change.

Public notification timeline of the proposed legislation

Friday June 6th – Late in the afternoon: an email was sent to a small, select group to attend an open meeting on 6/11 to learn of the proposed Legislative Proposal for Net Metering and New Solar Incentive Program.

Wednesday June 11th – Due to the power of the internet, the email was circulated and this meeting had over 200 attendees.  Six participants actively involved in proposing legislation to totally overhaul the solar incentive program rolled out their proposed plan.  The reason this committee was initially formed was due to the very real need to address the net metering limits.  As a by-product and to reach a compromise, the VERY successful SREC program will be eliminated if this bill is promulgated.

Friday, June 13th – The Joint Committee on Telecommunications, Utilities and Energy voted to adopt their proposal (currently H.3901/S.2019) and was also favorably submitted to the House Ways and Means Committee.

Wednesday June 18th – The bill could be voted on as early as this Wednesday.

Thursday July 31st – The last day of the current legislative session.  The net metering must be addressed. Eliminating the current solar incentive program must NOT be included.

Let’s stand united.  Sign this letter and let your voice be heard.  Please forward this email to others that are advocates for continuing solar growth in MA.  If you have any questions, please do not hesitate to email or call me.

Alane Lakritz
President
Knollwood Energy of MA LLC
862-432-0259

The third and final round of the MA Solar Credit Clearinghouse Auction was held on Friday August 2, 2013. There were 38,866 SRECs deposited into the auction and only 3 SRECs were sold. The good news is that due to recent regulatory revisions to the RPS Solar Carve-Out compliance obligation formula, the Department of Energy Resources (DOER) is offering a one-time only purchase of all unsold 2012 Clearinghouse Auction SRECs at a fixed price of $285 per SREC.

You can choose to sell all, some or none of your reminted 2012 credits to DOER.  If you choose to sell all or some, you can expect to receive payment by the middle of September. Any SRECs that you do not want sold now will be returned to your Knollwood Energy account.  We can then sell those SRECs anytime during the next three years (2013, 2014, 2015), but they can never be deposited back into another Clearinghouse Auction.

If you want to sell all of your 2012 SRECs, then you do not need to do anything.  We will sell your 2012 SRECs to DOER and send you the payment. If you want to sell only some or none, then please email Alane@KnollwoodEnergy.com with the number of credits that you want sold. You can check your Knollwood Energy account to find the exact number of 2012 credits you have for sale (log into Knollwood portal, click on View Creation Summary and look at the SRECs Available in the row of the 2012 SREC year).  Again, If we do not hear back from you by Wednesday August 14th, we will sell all of your 2012 SRECs to DOER.

To read the full DOER announcement, click this link http://e2.ma/message/wsg2h/oq51x

If you have any questions, please do not hesitate to email or call Alane.

The end to the first MA SREC program is rapidly approaching.  Do you have MA projects that are on DOER’s approved Pending SQA list or projects that are 100kws or less?  Knollwood Energy provides the maximum flexibility for managing SRECs.  We provide fixed, variable, and upfront contracts or a combination of  these options for residential through multi-megawatt projects. Our 10 year fixed contract has been used to save commercial deals that might not move forward without the pricing that we are able to provide. We consistently sell SRECs for a higher price than our competitors. We are selling first quarter 2013 minted SRECs for $233.

Knollwood Energy is a family run business, and one of the largest institutional sellers of solar renewable energy credits in the country. We have been monetizing credits since 2006 with over 4,500 customers.  Knollwood Energy makes the SREC registration process seamless and effortless for our customers.  Knollwood Energy’s approach has always been to help our customers make the most informed decisions to meet their individual financial needs by offering them a customized SREC selling strategy.

Please contact Alane Lakrtiz at 862-432-0259 to discuss how we can work together.

MA DOER held a Solar Policy Stakeholder Meeting on June 7, 2013.  At that meeting, DOER announced emergency regulations to address the oversupply of SREC applications. DOER also reviewed the proposed post-400 MW solar program policy design.

The following outlines the emergency regulations discussed at the meeting.

EMERGENCY REGULATIONS

The emergency regulations are divided into two categories: Projects over 100kw and Projects 100kw and less

Projects >100kw

If a project did not receive a Statement of Qualification from DOER by June 7, 2013, there are still two ways to qualify for the first 400MW Solar Carve-Out Program.

1.)  If DOER has deemed the project administratively complete and it is within the 400MW cap.

2.)  If a project is not in the 400MW cap but received an Interconnection Service Agreement (ISA) on or before June 7, 2013, then a Statement of Qualification Application (SQA) needs to be submitted to DOER along with the ISA no later than one week of the effective date of the emergency regulations.  Knollwood Energy will submit the required documentation on behalf of the customer.

To receive a Statement of Qualification, all projects MUST receive the Authority to Interconnect on or before December 31, 2013.  DOER will grant an extension if the project has expended at least 50% of the total construction cost by December 31, 2013.  If an extension is granted, it MUST be interconnected by March 31, 2014 unless the delay is solely caused by the utility.

If the above guidelines are not met, a project is not eligible for the first Solar Carve-Out Program.

Projects <= 100kw

All projects that are equal to or less than 100kw will continue to be qualified for the first 400MW Solar Carve-Out Program.  The  Authority to Interconnect must be granted prior to the first day of the post-400MW program.  This is expected to be on or after January 1, 2014. Knollwood Energy will submit the necessary documentation to DOER within the required timeframe.

Assisting our Installer Partners

Knollwood Energy has submitted a Statement of Qualification for all projects that we received by June 7th, including those that have not interconnected yet. Please contact Alane Lakritz  immediately if you are aware of a project that is over 100kw, received the Interconnect Service Agreement by June 7th, and has not submitted an SQA to DOER.  We will submit the required documentation to DOER.

Please note, the emergency regulations proposed by DOER on June 7th and reviewed above are not finalized.  There can be additional criteria included in the final regulation which is expected to be finalized within three weeks.

Alane Lakritz
President
Knollwood Energy of MA LLC
862-432-0259
Alane@KnollwoodEnergy.com

40 Quarter Opt-In Term To Be Reduced

It is expected that the 40 Quarter Clearinghouse Auction Opt-In Term will be reduced to 32 Quarters effective July 20, 2013.  The last day to submit paperwork to MA DOER for a system to receive a 40 quarter Opt-In Term is June 20, 2013.

• The paperwork that Knollwood Energy will need by June 10th to meet the June 20th deadline is:  PV Detail Form, RPS Agreement, and our contract.
• Authority to Interconnect:  Not required by June 20th but must be provided to us as soon as it is received.
• The 40 quarters for these systems will start October 1, 2013 and end September 30, 2023 regardless of the actual Authority to Interconnect date, unless the Interconnect occurs prior to October 1, 2013.  In that case, the 40 quarter opt-in term will start with the actual quarter of interconnect.
• Production towards SRECs will not start until the Authority to Interconnect date.

2012 Minted SRECs and Reported Production

Based on what has been minted and reported for 2012 production to date, there are currently 38,447 excess 2012 SRECs.  This amount will increase since there is one more month that Q4 2012 production can be reported.

*Q1,Q2,Q3 Minted SRECs                   91,684

*Q4 MWH reported production           24,828

Total                                     116,512

**2012 Compliance Obligation           81,559

Total Current Excess                         38,447

*Q1:  January – March production, Q2:  April – June production, Q3:  July – September production, Q4:  October – December production

** Exact 2012 compliance obligation is determined by load and will be announce the end of March, 2013

 The Clearinghouse Auction

Unsold 2012 SRECs can be deposited into the MA Clearinghouse Auction which will take place at the end of July, 2013.   The auction price is fixed at $300 (minus the MA fee of $15 = $285).  The buyers bid against each other for the number of SRECs they want to purchase.  It is possible that some of the SRECs deposited in the auction will not be sold.  Sold SRECs will be allocated on a pro-rated basis, so that an equal percentage of SRECs are allocated for each system that deposited SRECs.  All remaining SRECs will be returned. These returned SRECs can then be sold anytime over the next three years but they can never go into the Clearinghouse Auction again.  If they are not sold at the end of the three years they will expire.  Knollwood Energy will continue to evaluate market conditions to decide if we will enter fourth quarter SRECs in the auction or to sell them in the market.

 400MW Carve-Out Cap

MA has already installed half of the 400MW capacity cap for the current SREC program.  It is expected that MA will reach the 400MW no later than the middle of 2014. MA DOER released a Solar Carve-Out Rulemaking and Policy Development Update today.  Click here to view the update http://e2.ma/message/c9jkg/stylw.

 Installer Partners

There is an installer partner link on our website, www.KnollwoodEnergy.com.  If you would like to be listed, please email Amy@KnollwoodEnergy.com with the following information:

Company name, contact information (website, contact name, email address, phone number), and states served.

A Message For the New Year

It has been a tradition at Knollwood Energy to make charitable contributions each December in honor of our customers and installer partners as our way of thanking those who have participated in our successes while giving back to the community.  In light of the terrible destruction in our own state from Hurricane Sandy, we have chosen the Hurricane Sandy New Jersey Relief Fund for our 2012 holiday contribution.

We wish you all the best in 2013.

3rd Quarter 2012 SREC Minting

Production from third quarter 2012 will be minted on January 15, 2013.  SRECs are created in increments of 1,000kWhs.  Third quarter SRECs are currently trading around the same price as last quarter ($205 – $215).  Knollwood Energy is still cautious about the prospects for the Clearinghouse Auction for the 2012 year. Based on our evaluation of risk and return, we are planning to sell all third quarter credits for our customers who are set up under Knollwood’s Discretion and our Sell Quarterly option.

Here are answers to some F.A.Q’s:

Will I be creating an SREC on January 15th?

If you had production of at least 1,000kwhs between July – September you will create an SREC(s).  If you had production during those months but did not produce a full 1,000kwhs, or if your system interconnected after September 2012, you will not create an SREC this quarter.  Partial production over/under 1,000kwhs rolls to the next quarter.

Am I set up to sell at Knollwood’s Discretion?

Unless you emailed us specific instructions with a minimum price or advised us to sell your credits every quarter, you are set up as Knollwood’s Discretion.  If you would like to change your monetization option, please email instructions by January 18th to Jodi@KnollwoodEnergy.com.

I am creating an SREC(s). When should I expect payment?

We will process payments the first week of February.

How will the Clearinghouse Auction work?

Unsold SRECs from 2012 can be deposited into the Clearinghouse Auction which will take place in July 2013.   It is anticipated that approximately 25,000 SRECs will be deposited into the auction.  The auction price is set at $300.  The buyers bid against each other for the quantity of SRECs they want to purchase.  It is possible that some or even all of the SRECs deposited will not be sold.  Since this is the first year the Clearinghouse Auction will be held, it is an untested market.  We are currently expecting that not all credits deposited will be sold.

Sold SRECs will be allocated on a pro-rated basis, so that an equal percentage of SRECs are allocated for each system that deposited SRECs.  All remaining SRECs will be returned. These returned SRECs can then be sold anytime over the next three years but they can never go into the Clearinghouse Auction again.  If they are not sold at the end of the three years they will expire.

Why is the current SREC price less than $300?

The floor mechanism is really more of a price support mechanism.  During the initial heavy installation stage, there are so many new systems coming online, that buyers of SRECs are able to acquire what they need well below this price.   Therefore, they don’t need the extra SRECs offered in the auction.

Once the build out is finished, or when the dynamics of the auction create an incentive to purchase the SRECs in the auction, we should see the quarterly price get closer to the Clearinghouse Auction price.

Why are we choosing to sell?

We believe that on a risk-adjusted basis, it is a better decision to sell at current prices.As market dynamics change, we will adjust our selling strategy.

We get asked all the time why the price of SRECs has dropped so much after the legislative “fix” signed by Governor Christie.  While we believe that the fix will keep NJ from seeing prices go down to the PA price range ($25), the issue of current and future oversupply is still an issue for SREC pricing.

The legislation increased the demand for NJ 2014 SRECs (starting June, 2013) from about 770,000 to over 1,600,000 SRECs.   This is an increase of OVER 100%, so why have prices dropped since the legislation was signed?  The simple reason is current oversupply and expected new supply.

As of August 31, 2012 NJ has installed about 876 MW of solar and the state is still installing over 20 MW/month.   At that rate, we will create about 1,100,00 SRECs for the 2013 SREC year.   That is about 525,000 more SRECs than required.  In 2012, we had an excess of about 257,000 SRECs.  So, combined we will have about 782,000 excess SRECs heading into the 2014 SREC year.

The table below goes over a few scenarios.  The charts assume build rates effective September 2012.  At an average build of 15 MW/month, we won’t get into balance until the 2015 SREC year and would be short in 2016 based on that build rate.   A build rate of 20 MW/month, would keep us long all the way through the 2016 SREC year.

If we drop immediately to 10MW/month, the market will be short in 2015 and we would see prices move up if we start seeing that build rate.  As long as installations are in the 20 MW range, prices will stay under pressure.

On August 29th, the Massachusetts Department of Energy Resources (MA DOER)  announced the 2013 requirement for Solar Renewable Energy Credits in the MA Solar Carve-Out program.  Based on the existing calculation used by the DOER, the 2013 requirement would be 130,711 SRECs.  This number  takes into account the impact of the Pre-2010 load which will reduce the demand by 4,784 SRECs.

However, in an effort to adjust for the current market conditions, DOER intends to make a change to the Compliance Obligation formula that would increase the demand by 53,802 SRECs, or a total of 184,513 required SRECs in 2013.   If approved, this increase in demand would be retroactively applied to the entire 2013 SREC compliance year.  DOER welcomes any comments on this announcement before formally beginning the rulemaking process. Such comments should be sent to  DOER.SREC@state.ma.us by 5:00pm on September 14th..

In either scenario, we are expecting the market for 2013 will be oversupplied. DOER is currently predicting that at the beginning of the 2013 SREC year, there will be approximately 165MW of installed capacity. That 165MW will generate approximately 190,00 SRECs.  So, even with the rule change the market is predicted to be oversupplied in 2013.