How does a Renewable Portfolio Standard affect my solar PV system?
Each RPS has a solar “carve out” which requires that a certain percentage of all electricity sold in each state be derived from solar energy. Electricity suppliers can meet the solar carve out by either generating and selling the required percentage of solar energy, accumulating the equivalent amount of SRECs that equal the percentage of solar energy they are required to sell under the RPS, or paying a statutory fine called the Alternative Compliance Payment (ACP). When a utility company uses an SREC to comply with the RPS, the SREC is retired and cannot be used again.
