Illinois Distributed Generation Procurement
Illinois Distributed Generation Procurement

Illinois Distributed Generation Procurement

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Illinois Distributed Generation Procurement for Solar System Owners


In September 2015, the State of Illinois will offer an incentive to existing Illinois renewable energy distributed generation (DG) producers (systems <2,000kW) through the purchase of Renewable Energy Credits (RECs). This program is administered as part of the Regular Procurement hosted by the Illinois Power Agency (“IPA”) and is funded through utility dollars collected for this purpose.


Summary of the Distributed Generation Procurement


The IPA runs procurements to purchase power as well as RECs for the state’s investor owned utilities. The purchase of RECs is required to meet the renewable energy targets in the Illinois Renewable Portfolio Standard. The IPA is hosting a procurement this September to purchase RECs from solar installations in Illinois, as well as from other eligible renewable energy technologies.  The procurement will purchase RECs from system owners for 5 years.  During this time system owners with winning bids must sell all of their RECs into this procurement. Systems will be categorized by energy type and system size; <25kW and those >25kW up to 2,000kW.  The systems must be located in Illinois, both new and existing solar energy systems qualify.  The utilities will purchase all RECs generated by winning systems between June 2015 and May 2020.  The date that your system starts generating RECs is the date that the system was energized AND registered with a tracking system, not the date the system was turned on.  CSG will register your system with a tracking system as part of their services.


What is a REC? 


A Renewable Energy Certificate (“REC”) is a tradable, environmental asset that represents the environmental attributes of one Megawatt hour (1,000 kWh) of solar electricity. This opportunity is different than a net metering agreement with the utility. It is based on the total energy production of the renewable system in quarterly increments.  Renewable energy system owners produce clean electrons and avoid dirty electrons from entering the electric grid.  RECs are a way to track and monetize the environmental benefits of the clean energy being generated. The term Solar REC or SREC denotes the environmental attributes generated from a solar installation.


IPA Regular Procurement Opportunity


In order to participate system owners must report their solar production from meter or inverter readings on a quarterly basis through a regional online clearing house or “REC tracking system”. Once the system is registered it may generate RECs on the tracking system.  These RECs can be sold through REC aggregators who bundle and market them to state entities and utilities that require them for compliance with the state’s RPS. For this procurement, the Illinois Power Agency requires an aggregator to act as an agent on behalf of the system owners to aggregate the RECs and enter into a single contract with the Illinois utilities.

At this time, ISEA is aware of only one business offering aggregation services for this procurement, Carbon Solutions Group.

Carbon Solutions Group


Carbon Solutions Group (CSG), an ISEA Preferred Vendor, is offering its services as a REC aggregator to assist Illinois solar system owners to monetize their SRECs.


Although the final documentation has not been released by the IPA, Carbon Solutions Group has provided the following steps to participate. If you are interested in selling your SRECs for 5 years going forward into this procurement, follow the steps below to begin the registration process with Carbon Solutions Group. CGS will keep you updated as final information and documents are released.


How it Works


Action Item Deadline
1.     Enter your system info into form: System Info Form (This includes technical details regarding your array and you may need information from your installer if not readily available)  Sept 15th
2.     Final documents are published by IPA Sept 1th
3.     Contract is generated for your system and sent to you via e-mail (as you submit your info)
4.     CSG submits aggregated bid to IPA Sept 17th
5.     Sign and return contract to CSG ( Due     Sept 30th
6.     Notice of winning bid from the IPA Oct 14th
7.     Begin generating your own renewable electricity and receive payments for your SRECs First payment Feb 2016


SREC Pricing


The Illinois Power Agency (IPA) procurement is a confidential bidding process to purchase RECS installations located in Illinois.  Bidders must bundle individual systems into large (1MW) blocks which will allow for limited flexibility in individual bid pricing. The auction is a closed bidding process, the highest clearing price will remain confidential.  However, due to their insight into the market, Carbon Solutions Group has strong indications on what the final prices will be.


The IPA will categorize bids into two categories: systems <25kW and those >25kW up to 2MW. They will then select winning bids by ranking them from the lowest price to the highest until the budget has been spent.  The IPA has a goal of purchasing equal amounts of RECs from both size categories.  This goal to procure at least 50% from systems in the <25kW category as available, will potentially reward higher average winning prices to smaller systems. A benchmark ceiling will be set by the IPA on the highest allowable bid price, and therefore lower bids will have a more likely chance of being selected than higher ones. If your bid is not selected, the IPA will not purchase SRECs from your system during this procurement event.  CSG intends to offer and bid a price that balances the chance to win the procurement and that adds meaningful value to system owners.


CSG will manage all administrative paperwork for bidding your system as well as assume the fees associated with submitting your bid.  If your system receives a winning bid, CSG will register your system with the appropriate tracking system so you can begin generating SRECs.  Once your system is registered CSG will handle all of the generation, transfers, and invoicing with the IPA.   The winning amount on your contract with CSG is the amount that you will receive per SREC generated throughout the 5 years of the Program. Please contact CSG directly if you have any questions or concerns.


For more detailed info check out the webinar that we hosted with the IPA.


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