Why SRECs are a poor way to stimulate solar power installations.

People and markets like consistency and stability. Things that wildly swing up and down are neither favoured by populations nor by investors (unless they are swingers in either case!).

This article clearly illustrates the fallacy of the incentive programs using SRECs vs Feed-in-tariffs both in the incentivization of companies or residents. The wild swings downwards when there is oversupply means that you actually exacerbate the situation by making it less and less appealing to put down solar farms.

It is why Germany’s CLEAN or Ontario’s FIT programs are frankly the best to go with. They are simply feed in tariffs that cleanly and efficiently reward installers with known paybacks. Investors like it, residents want the simplicity and installers know what they can depend on, so long as the return on investment is easy to figure out.

Complicated processes or means to achieve incentives for solar rarely work because they demand so many man-hours to determine if a project is viable, and then the hope that the incentives all stay in place before signature time is fleeting as politics enter the fray.

Keep it simple…

Sass