Solar

SREC (Solar Renewable Energy Certificate) A tradable credit you earn for every 1,000 kWh your solar system generates

Alex Rivera By Alex Rivera, Senior Solar Editor · Updated 2026-06-09
← All Glossary Terms Definition
A Solar Renewable Energy Certificate (SREC) is a tradable certificate representing the environmental attributes of 1 megawatt-hour (1,000 kWh) of solar electricity your system produces. It is separate from the actual power you use or send to the grid. In states with a Renewable Portfolio Standard (RPS) that includes a solar carve-out—such as NJ, MD, MA, and DC—utilities must buy a set amount of solar generation, so they purchase SRECs from system owners to meet that obligation. This creates added income for homeowners and businesses on top of energy savings. Markets and prices vary widely by state, and not every state has an SREC program at all. Your earnings depend on local rules, market supply, and how much your system generates each year.
Also Known As
SREC Solar Renewable Energy Credit Solar Carve-Out Certificate RPS Solar Credit
Used in Context
  1. After installing panels in New Jersey, you registered your system to start earning SRECs you can sell to utilities for extra income.
  2. A Maryland homeowner reviewed quotes from Dreamy Leads and asked each installer how the state's SREC market would affect their payback.
  3. Because their state has no solar carve-out, the family relied on bill savings alone since there were no SRECs to sell.
Related Terms
Solar Net Metering The utility billing policy that credits solar owners for surplus electricity sent to the grid Solar Feed-in Tariff (FiT) A guaranteed above-market rate paid for every kWh your solar system sends to the grid Solar Kilowatt-Hour (kWh) The unit of energy used for electricity billing—one kilowatt of power used for one hour Solar Photovoltaic (PV) System A solar electric setup that turns sunlight into usable electricity Solar Community Solar Subscribe to a share of an off-site solar array and earn utility bill credits without installing panels
Frequently Asked Questions

How many SRECs will my solar system earn?

You earn one SREC for every 1 megawatt-hour, or 1,000 kWh, your system generates. So a system producing several thousand kWh per year may earn multiple SRECs annually. Your exact count depends on system size, sunlight, and how your state measures and credits generation.

Which states have SREC markets?

SREC markets exist in states with an RPS solar carve-out, such as New Jersey, Maryland, Massachusetts, and Washington, DC. Many states have no SREC program at all. Markets and prices vary widely by state, so check your local rules before counting on this income.

How much is an SREC worth?

There's no single price—SREC values vary widely by state and shift with market supply and demand. Some markets pay significantly more than others, and prices can change over time. Because outcomes are not guaranteed, treat SREC income as a variable supplement rather than a fixed return.

Ready to compare solar options?

Free quotes from licensed experts — no spam, no obligation, results in 60 seconds.

Get Free Quotes →

Sources

Get Free Quotes → All Terms