1. World Green Exchange exceeds expectations
A New Jersey-based provider of third-party renewable energy project finance solutions, had 1,500 Solar Renewable Energy Certificates (SRECs) to sell. This is a new market area with few transactions to date and, as a result, awareness of SRECs is relatively low and apparent liquidity scarce. In fact, when the provider came to World Energy, it marked the first time that an online auction event would be employed to sell solar renewable energy credits. As a service to the client, World Energy consulted with various bid-and-ask exchanges to establish an expected price range. A benchmark of between $180 and $200 per credit was set. The auction attracted all three New Jersey public utilities, eager to purchase the credits in order to comply with New Jersey’s Renewable Portfolio Standards. By hosting an event and identifying the demand, World Energy effectively created the necessary liquidity. In all, 15 bids were placed, with price transparency serving to drive the price upward. Result: The winning bid was $247 per credit, a premium of almost 25% over the bid/ask estimate. World Energy was able to help a seller in an immature market by creating a neutral marketplace and forcing competition in a way a paper RFP could not. Back |
