A Solar Renewable Energy Certificate, or SREC, is a separable credential that represents one megawatt-hour (1,000 kWh) of solar electricity production. The kWh itself flows through your utility meter and offsets your bill through net metering. The SREC is a separate, tradeable certificate — a paper claim that the megawatt-hour was generated from solar — and utilities buy it to meet state Renewable Portfolio Standard compliance obligations. The income from selling SRECs is one of the few solar revenue streams that survived the federal ITC's December 2025 expiration intact.
A typical 8 kW residential solar array generates 10-12 SRECs per year. In an active SREC market state, that translates to $500-3,200 in annual SREC income on top of net-metering bill avoidance — for the duration of the contract or registry-eligibility window.
How SRECs are created and tracked
When your array produces electricity, two things happen simultaneously. The electrons flow through your meter (where the utility tracks consumption and export for net-metering purposes), and the production is recorded in a state-specific renewable-energy registry — PJM-GATS for the Mid-Atlantic, NEPOOL-GIS for New England, M-RETS for the Midwest, or a state-specific system. The registry mints one SREC for each 1,000 kWh of solar production.
The SREC is yours. You can sell it to anyone in the state's compliance market — typically through an aggregator like SRECTrade or Sol Systems, which pools residential SRECs and sells them in bulk to utility buyers. The kWh and the SREC are different products, sold to (potentially) different buyers, with different price discovery mechanisms.
What sets the price
State Renewable Portfolio Standard (RPS) mandates set how many SRECs utilities must acquire each compliance year. The "solar carve-out" within an RPS — the percentage of supply that must come specifically from solar — determines demand. The supply side is whatever the state's solar fleet produces.
When supply roughly equals demand, prices clear in the middle range. When utility solar build-out runs ahead of the carve-out, supply exceeds demand and prices fall. When the carve-out steps up faster than build-out, demand exceeds supply and prices rise. The price ceiling in every market is the Solar Alternative Compliance Payment (SACP) — the penalty a utility pays for falling short. No utility will pay more for an SREC than the SACP, because they could just pay the penalty instead. SACPs are set by state law and typically run $200-500 per MWh.
Active SREC markets in 2026
- New Jersey — $200-260 per SREC (early 2026 SuSI auction range). The Successor Solar Incentive program runs auction-cleared prices. Strongest pricing in the country.
- Massachusetts — $230-280 per SREC. Layered with the SMART tariff for additional per-kWh compensation.
- Maryland — $50-65 per SREC. Smaller than NJ or MA but stable; combines with the state Energy Storage Tax Credit.
- Illinois — $50-75 per SREC equivalent. Adjustable Block Program issues 15-year fixed-price contracts. Less upside, more certainty.
- Delaware — $25-50 per SREC. Smaller utility build-out obligation, lighter demand.
- Pennsylvania — $30-55 per SREC. Closest competitor to Maryland on price.
- Ohio — $5-15 per SREC. Carve-out is small; supply has run ahead of demand for years.
- DC — $300-450 per SREC. Highest prices by far — small volume, persistent shortage.
Sunset and never-had markets
Connecticut — sunset. The Residential Solar Investment Program (RSIP) closed; the state pivoted to the RNS tariff.
Most of the South and West — never. These states either lack RPS mandates or have RPS structures without solar carve-outs. Solar economics run on net metering and bill avoidance alone.
How a homeowner sells SRECs
Few homeowners sell SRECs directly. Most contract with an aggregator — SRECTrade, Sol Systems, Knollwood Energy — that registers the system, mints SRECs in the state registry, and sells them in bulk on behalf of pooled residential customers.
Two contract structures dominate. Spot pricing — the aggregator sells at current market price each month, less a 5-10% fee. Full upside, full volatility. Fixed-term contracts — the aggregator pays a fixed price per SREC for 5, 10, or 15 years, typically 10-20% below the recent spot average. For most residential systems, the fixed-term contract is the cleaner choice — predictable, removed from market timing.
A typical 10-year contract in a strong-market state (NJ, MA, MD): $130-220 per SREC fixed. An 8 kW array generating 11 SRECs/year produces $1,430-2,420 in annual SREC income for the contract term.
Why this matters in 2026
The federal Investment Tax Credit was a one-time tax benefit; its 12/31/2025 expiration removed that benefit. SRECs are a recurring income stream tied to state compliance mandates, enacted state-by-state in the 2000s and 2010s — entirely separate from federal policy. The income persists regardless of what happens at the federal level.
In a state with an active SREC market AND a strong state income-tax credit AND high electricity rates, residential solar still pencils out to an 8-12 year payback in 2026 without the federal ITC. SRECs are the single biggest variable that distinguishes the fast-payback states from the slow-payback states.
This is reference, not a quote. Run your specific numbers through the Solar Reality Check tool. For the broader post-ITC framing, see the solar hub.