What it is
A solar renewable energy credit, often shortened to SREC or REC, is a tradable certificate that represents the clean electricity a solar system produces. Each certificate generally stands for a set amount of generation, measured by a meter. The certificate is separate from the electricity itself.
Because the certificate and the power are separate, a household can use the electricity at home while the credit is tracked, registered and sometimes sold to another party. Buyers have traditionally been utilities or companies that need to show they support renewable generation.
Not every area has a market for these credits, and the rules differ widely. Some programs are run by states, some by utilities, and some are voluntary. Programs have changed over time and keep changing, so what applies to a neighbor may not apply to you.
How it’s traditionally been approached
Many homeowners first hear about credits when they compare solar proposals. Some proposals mention them as a possible income stream, while others leave them out entirely. Both approaches are common.
Where a credit market exists, the system owner has typically registered the system, reported its production and then sold the certificates through a broker or an aggregator. Other owners have signed over the credits as part of a lease or power purchase agreement, which is worth understanding before you commit.
Credits are different from tax credits, rebates and net metering, even though people often mix them up. Each one has its own rules, paperwork and sources of confirmation. Treating them separately can make a proposal easier to read.
How the right solar installer may help
A licensed, insured solar installer may help you sort out which programs, if any, connect to your property. A typical visit often includes looking at your roof, your electrical panel, your usage and your goals. The installer can then explain how a system might be designed and how production would be metered.
Good questions to bring: Is there a credit program where I live, and who confirms it? Who owns the credits under this contract? Does the installer handle registration, or is that my job? What does the written quote say about credits, and what happens if the rules change?
Ask for everything in writing, and read the full contract before signing. Be cautious with high-pressure or door-to-door sales pitches that promise credit income. Confirm program details with your state energy office, your utility and the IRS or a tax professional.
The bigger picture
Energy decisions can touch both your finances and your peace of mind. It's natural to feel pulled toward the promise of extra income, or to feel overwhelmed by unfamiliar terms. Slowing down, getting answers in writing and choosing what fits your household can make the decision feel steadier.
Many people choose solar for self-reliance and preparedness, not just for numbers on a page. If you're weighing the wider picture of your household finances and support, Providers.plus may be a helpful place to explore. Whether you use credits, ignore them or can't access them, every approach can be reasonable.
Keep in mind
- This page is educational only and is not financial, tax, legal or engineering advice.
- Credit programs, incentives and net metering rules have changed and keep changing, so confirm current details with the IRS or a tax professional, your state energy office and your utility before signing.
- Any value from credits varies by home, location, utility and equipment, and should come from a written quote, never a verbal promise.
- Solar and battery work involves high-voltage electricity and roof work, so use licensed, insured professionals who follow local codes, permits and utility interconnection rules.
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Talk to a solar pro →Frequently asked questions
What are solar renewable energy credits?
Solar renewable energy credits are tradable certificates that represent the clean electricity a solar system generates. They are tracked separately from the power itself. Whether you can earn or sell them depends on your state, your utility and your system.
How do solar renewable energy credits differ from the solar tax credit?
A renewable energy credit is a certificate tied to production, while a tax credit is a tax-related incentive tied to a purchase. They have different rules and different sources of confirmation. Ask the IRS or a tax professional about tax questions, and your state energy office about credit programs.
Can I sell solar renewable energy credits from my home system?
In some areas, yes, and in others there is no market for them at all. Where a market exists, owners have often worked through a registry and a broker or aggregator. Check with your state energy office and utility, and ask your installer what they handle.
Who owns the credits if I lease my solar system or sign a power purchase agreement?
It depends on the contract. In some leases and power purchase agreements, the provider keeps the credits, while in others the homeowner does. Read the full agreement and ask for the credit language to be explained in plain terms.
Do I need solar panel installation to get renewable energy credits?
Generally, credits come from a solar system that generates electricity, so some form of solar panel installation is usually involved. The system typically has to be metered and may need to be registered under a specific program. Rules vary, so confirm details before you buy.
Will credits still work if the grid goes down?
Credits are about tracking production, not about backup power. A grid-tied system generally shuts down during an outage unless it was designed with storage or backup. If outage readiness matters to you, ask your installer about solar batteries and home energy storage.
Educational resource. 2A Solar shares general information and connects people with independent solar installers. It is not professional advice. Talk with a qualified professional about your own situation.