Solar SRECs: How to Earn Extra Income From Your Solar Panels
By MySolarWidget Team · March 8, 2026 · 7 min read
Most homeowners know solar saves money on electricity bills. Fewer know it can also generate additional income through a program called Solar Renewable Energy Credits (SRECs). In the right states, SRECs add hundreds of dollars per year to your solar return — making an already strong investment even better.
This guide explains exactly how SRECs work, which states have active markets, and how to sell them.
What Are SRECs and How Do They Work?
An SREC (Solar Renewable Energy Credit) is a tradeable certificate representing 1 megawatt-hour (1,000 kWh) of solar electricity produced. Utilities in certain states are required by law to source a portion of their electricity from solar — their "solar carve-out" requirement. When they cannot generate enough solar themselves, they buy SRECs from homeowners and businesses to meet their compliance obligation.
The Basic Flow
- Your solar panels produce electricity and automatically generate SRECs at a rate of one SREC per 1,000 kWh produced.
- SRECs are tracked through a state registry (e.g., PJM-GATS, NEPOOL-GIS).
- You sell your SRECs through a broker, aggregator, or SREC market platform.
- The utility buys them to satisfy their renewable portfolio standard (RPS) requirement.
- You receive payment — the SREC price — for each certificate sold.
SRECs are separate from the electricity you generate. You can sell the SREC while keeping the electricity savings. They are essentially a second revenue stream from the same solar panels.
SREC Prices by State (2026)
SREC markets exist in about a dozen states. Prices vary based on state RPS requirements, market supply and demand:
| State | SREC Price Range | Annual Income (7 kW) | Market Notes |
|---|---|---|---|
| New Jersey | $180–$300/SREC | $1,260–$2,100 | Active market, SREC II program |
| Maryland | $60–$100/SREC | $420–$700 | Moderate market |
| Massachusetts | SMART program | $300–$800/yr | Fixed adder, not open market |
| Pennsylvania | $20–$50/SREC | $140–$350 | Volatile, lower prices |
| Ohio | $5–$20/SREC | $35–$140 | Low demand, minimal market |
| Washington DC | $350–$450/SREC | $2,450–$3,150 | Highest prices nationally |
Assumes 7 kW system producing ~7 MWh/year. DC and New Jersey have the strongest SREC markets for homeowners.
How to Sell Your SRECs
There are three main ways to monetize SRECs:
1. SREC Aggregators / Brokers
Companies like SRECTrade, Sol Systems, and Joule Assets aggregate SRECs from many homeowners and sell them in bulk to utilities. They take a small commission (5–15%) but handle all registration and sales. This is the easiest option for most homeowners.
2. Long-Term SREC Contracts
Some utilities and compliance buyers offer multi-year fixed-price SREC contracts (typically 5–10 years). You trade upside potential for price certainty. Good option if current SREC prices are high and you want to lock in.
3. Spot Market Sales
You can sell SRECs directly on spot markets like SRECTrade's marketplace. Prices fluctuate with supply and demand. Higher risk but potentially higher reward when market prices spike.
Getting Registered
Your solar installer typically handles state registry enrollment as part of installation. If not, contact your state's SREC administrator directly. Registration is free or low-cost.
SRECs vs. Other State Incentive Programs
Not every state uses open SREC markets. Some use fixed-rate alternatives:
- Massachusetts SMART: Fixed monthly payments per kWh for 10 years, set at program enrollment. More predictable than SREC spot prices but capped.
- Illinois SREC+ (ILSFA): Illinois buys SRECs at administratively set prices through a competitive program — not open market.
- Connecticut ZREC: Zero-emission RECs for larger systems (>100 kW). Not available to typical residential.
If your state does not have an active SREC market, check for performance-based incentives, utility renewable programs, or community solar buyback options as alternatives.
Frequently Asked Questions
How many SRECs does a typical home solar system generate?
A 7 kW system producing 8,400 kWh/year generates approximately 8.4 SRECs per year (one per 1,000 kWh). In New Jersey at $200/SREC, that is about $1,680/year in additional income.
Do SRECs expire?
Yes — SRECs typically have a limited compliance life of 3–5 years depending on the state. Unsold SRECs that expire are worthless, so it is important to sell them promptly or use an aggregator who manages this for you.
Is SREC income taxable?
Yes — SREC income is generally taxable as ordinary income at both federal and state levels. Keep records of all SREC sales and report them on your tax return. Consult a tax professional for your specific situation.