Image Source: SRECTrade

In Pennsylvania, the overall RPS has a "solar carve-out" that says a certain portion of renewable electricity must come specifically from solar power.

PA SRECs have a lifespan of three years. Any SREC you generate in 2023 can count through 2025. Business owners and residents must own (not lease) their solar energy system in order to be eligible to sell SRECs in the Pennsylvania market.

RPS solar carve-out: 0.5% in calendar year 2021 (out of 18 percent overall RPS)

The Pennsylvania SREC market peaked above $300 in summer 2010, but quickly became oversupplied as systems built in other PJM interconnection states exported their SRECs to Pennsylvania as allowed under the state’s RPS plan.

The oversupply sent the PA SREC price crashing to a low of $4 by summer 2017. On October 31st, 2017 Governor Tom Wolf signed House Bill 118 that closed the state to the import of out-of-state sRECs. Existing out-of-state contracts would be honored through their termination date. 

The legislation had an impact on market pricing, boosting the price for freshly minted PA SRECs close to $40 in 2021. Undersupply from a lack of SREC imports means in-state SREC prices are pressured upwards.

In early 2021, Wolf announced that half of PA's government electricity would come from solar energy by 2023. Meanwhile, a pair of state senators introduced legislation that would increase the PA RPS solar carve-out target to 5.5 percent by 2026. That legislation has since stalled but updated targets are still likely.

New Jersey has seen consistently strong SREC prices for over a decade with spot prices around $223 at the beginning of 2023. The legislature and governor have modified the state’s RPS plan several times over the period, raising the amount of solar generation suppliers need to acquire. Assembly Bill 3723, signed by Governor Murphy in May 2021, was one such effort. 

However, AB-3723’s solar requirement plateaus at approximately 5,300 gWh and reduces the Alternative Compliance Penalty steadily through 2033 as the state transitions to a new program.

The New Jersey Successor Solar Incentive (SuSI) program officially opened for projects on August 28, 2021.

RPS solar target: 6% by calendar year 2023, increasing to 14.5% by 2030

In 2019, Maryland Governor Larry Hogan passed the Maryland Clean Energy Jobs Act that pushes the overall RPS to 50% by 2030, 14.5% of which comes from solar.

By summer 2021, Hogan passed SB-65 into law to revise the state's RPS, decreasing the rate of solar carve-out increase over the next seven years while increasing the solar alternative compliance payment (SACP) during the same time period. The end goal for the RPS remains the same. Originally, the SACP was projected to decrease during this time period. This pivot will help decrease the degree of undersupply in upcoming years.

At the start of 2023, the latest bid price for MD SREC prices was near $59.

SRECs are an important tool to help utilities companies prioritize renewable energy like solar. They're also an effective method of generating passive income for solar power system owners. When combined with low-cost financing, investing in in-house solar for your PA business is a no-brainer.

Here are some of the benefits of behind-the-meter solar power:

• Sustainability: Energy sustainability is one trend that isn’t going anywhere soon - unlike our finite amount of fossil fuels. Behind-the-meter energy management allows you to generate your own power from renewable energy sources like wind, water, and the sun and store excess energy for later use.
• Save Money: Renewable energy often requires an initial investment, but you’ll definitely reap the rewards of savings down the line. If you can fulfill all of your own energy needs using sustainable means like PV panels, your energy costs will plummet after 6-9 years. You can also save money on demand charges by reducing your energy consumption during times when demand is high and using your stored power instead.
  
• Independence: BTM energy production and storage is becoming more important as extreme weather and natural disasters like California’s forest fires have shut off power to thousands of residents and businesses. With BTM generation, you don’t have to rely on outside sources for your power, and you can store excess energy to use during emergencies. So even if there’s a blackout or power outage, you can still operate normally.
  

In short, microgrids are freestanding grids that are independent of larger, regional grids. While many can be integrated within these larger frameworks, they don't rely on them. When the going gets tough, a microgrid's control system flips a switch that tells it to decentralize itself. This allows the microgrid to reap the benefits of its own power, without succumbing to widespread failure.

Resiliency

Similar to decentralized currency, microgrids are an independent energy solution. They don't have to rely on larger energy platforms to function, though they're able to integrate with regional power grids to provide a more robust grid system in a particular area. 

Microgrids exist on a small scale, though systems of microgrids — as well as microgrids connected to regional power grids — have impressive capacity. When it's time to go independent, they "island" off, giving microgrid-run communities or facilities the upperhand in the wake of brownouts. For industrial and commercial locations who can't afford to ride out outages, this is an empowering reality.

Sustainability

In practice, most of the world's microgrids rely on diesel generators. But with more stringent environmental regulations in place, the times are a-changin'. The US primarily uses natural gas and combined-heat-and-power (CHP). Moreover, experts expect solar photovoltaics (PV) to account for 19.5% of the global volume of microgrids by the end of 2025. 

Microgrids are especially relevant in regions hit hard by climate change. Heightened rates of natural disasters make energy resiliency even more important — and to resolve outages in an efficient way only makes sense. 

Because of microgrids' ability to integrate with various power sources, it proves to be a flexible baseline for localized, efficient energy to come.

CHP generators work in tandem with microgrids to make decentralized energy generation even more efficient and useful.

Because of the three laws of thermodynamics, waste heat is inevitable. CHP systems capture waste heat and transform it into thermal energy. When CHP generators work their magic on microgrids, they generate additional energy while simultaneously cooling the system. 

Wind is a magnificent act of nature, but there's one caveat: it's volatile. No wind, no power. Beside that, wind power maxes out at 40% of its potential energy output. When working in conjunction with CHP generators, microgrids can boost wind's potential energy output to upwards of 90%. US microgrids are more likely to utilize solar PV and natural gas. Still, it goes to show just how effective CHP is in capturing lost energy and lost money, regardless of the resource at hand.

In such a valuable partnership, CHP generators and microgrids work to boost efficiency and reduce net operating costs in any industrial setting.

An increasing number of microgrids are relying on solar PV, primarily as an additional generating source when other power is down.

On their own, solar panels cannot keep the lights on when the grid fails during an outage. Even when an industrial building has solar panels, that building still requires voltage from the grid to power the facility. But when a microgrid itself is fitted with solar capability, it can island itself to generate power during a storm or other unexpected event.

A microgrid can include multiple energy sources, but solar PV is an increasingly relevant part of the picture. As a result, many solar PV projects are now being built with future microgrid compatibility in mind, even before any grid planning takes place.

Thermal, fuel cell and other forms of battery storage make microgrids even more efficient and diverse. When retrofitted with battery storage, they become a wildly resilient source of localized energy deployment. CHP- or solar-generated power can be stored for later use to fill in gaps during outages or fluctuations.

On their own, microgrids are a form of energy security. But depending on a company's resiliency goals, that additional padding in the form of battery storage could be a necessary investment. Most microgrids are only partially resilient. Energy storage firms things up, meaning facilities can seamlessly reconnect to utility as soon as it's safe to do so.

In the midst of a swiftly changing world, energy resiliency can literally be a matter of life or death. Industrial facilities like hospitals, and commercial buildings like senior living centers, require energy to make use of available treatments and technologies.

At the same time, increased efficiency can build critical wiggle room into the bottom line. When you don't know what kind of investments you'll need to make next, efficiency makes all the difference. A thoughtful microgrid system delivers resiliency and sustainability to communities across the country; if that's not important in 2020, we don't know what is.

A1 Energy is a solutions-driven team of experts providing results in the form of solar PV, CHP and more. From feasibility studies to operation and maintenance, we support industrial clients seeking a more resilient, more efficient operation.

Resources:

https://www.grandviewresearch.com/industry-analysis/microgrid-market

https://courses.lumenlearning.com/introchem/chapter/the-three-laws-of-thermodynamics/

https://www.distributedenergy.com/microgrids/article/13034342/chp-and-microgridsa-profitable-pair#:~:text=Two%20such%20energy%20delivery%20technologies,to%20a%20group%20of%20users

https://www.nrel.gov/docs/fy18osti/70122.pdf

https://microgridknowledge.com/energy-storage-microgrid/

Major warehouses and distribution centers are leveraging the advantages of an energy optimization plan. By employing a tailored strategic energy plan, a warehouse operator can navigate toward successful cost reductions, increased productivity, improved safety, easier warehouse navigation, increased energy resilience, and a lower carbon footprint. The path toward long-term energy gains can be achieved with a three-pronged approach that incorporates energy efficiency measures like LED retrofits and lighting controls, strategic energy procurement, and develops pathways for on-site solar energy generation. These three efforts can deliver dramatic cost cuts for warehouses and offer some competitive advantages for the future. 

In addition to cost reduction, addressing energy as a part of a warehouse business’s strategic plan can help leadership be ahead of carbon regulations and cap and trade programs like the Regional Greenhouse Gas Initiative (RGGI). Energy optimization plans that are implemented for warehouses now will deliver more security into the navigable future, especially for warehouses located in RGGI states like Pennsylvania, Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, Vermont, and New Jersey. 

In this article, we will lay out the formula for a successful energy optimization path, starting with one of the heaviest energy loads on a warehouse, lighting.

As of a 2018 survey by the U.S. Energy Information Administration, it’s estimated that 3 billion square feet of warehouse facilities in the U.S. still employ old lighting technology. Historically, warehouse lighting arrays consisted of old metal halides (MH) and high-pressure sodium lamps (HPS). These older lamps are problematic because they are slow to fully light, lighting becomes quickly dulled, they have extremely short lifespans, waste energy, and they waste a lot of heat, which causes HVAC systems to run harder. For every 100 watts used to light a space, an additional 30-35 watts of cooling is required, according to ASHRAE (American Society of Heating, Refrigeration, and Air Conditioning Engineers.

Since lighting represents 60% of warehouse electricity usage, it poses one of the highest energy costs, based on the national average for utility costs. A complete warehouse lighting retrofit is the natural first step in an overall energy optimization plan to achieve a laundry list of initial benefits in a short payback period.

Some of the highlighted benefits of a warehouse switching to LED lighting include:

    ●  Longer lifespan

    ●  Lower energy costs

    ●  Lower maintenance time

    ●  Lower maintenance costs

    ●  Eliminate the ongoing cost of ballast replacements (~$100/ 2 ballasts)

    ●  Lower HVAC demand

    ●  Increase productivity

    ●  Improved sleek, modern look

    ●  Eliminates breakage hazards from mercury lamps

    ●  Decrease downtime

    ●  Leverage financial rebates & incentives

 Check out this zero upfront capital LED retrofit at Spooky Nook Sports:

Now that we’ve effectively lowered energy costs with an LED retrofit let’s see how we can optimize our energy usage even further with some warehouse lighting control strategies.

Employing the right set of energy control strategies can help to achieve next-level energy reduction goals. Before implementing a controls strategy, you will want a full understanding of the warehouse layout to designate for areas of predictable activity. For example, many warehouses use zoning tactics to place the higher demand areas in the warehouse closer to the proximity. Zones offer more control for less frequently used areas so that lighting can be tailored to each of these regions. It’s essential to have a roster of use areas and distinguish important areas like workspace zones versus high traffic and low traffic storage aisles.

Lighting controls work to help us answer some simple yet highly important questions for reducing energy usage like:

    ●  What kind of lighting is needed?

    ●  Where is lighting needed?

    ●  When is it needed?

These are some of the key methods used for effective warehouse lighting controls.

Dimming & Daylight Sensors

In locations with significant natural lighting, dimming is an effective strategy to meet the needs of darker hours of operation. When sensors are programmed to divest light during the day, coupled with occupancy sensors, there is great room for energy savings with dimming.

Occupancy Sensing

Warehouses can gain big from commonly used occupancy sensing. The system functions by detecting movement using a passive infrared or ultrasonic sensor. For warehouses, this method helps save energy in infrequently used areas. It’s also very convenient for workers who need immediate illumination where tasks must be completed, but also the support of a system that can shut off or dim lighting when the space is no longer occupied.

Time Scheduling

One of the most common features of a lighting control system is time scheduling. This simple method can be used for scheduling specific on and off times for hours of operation or can be programmed for more complex scheduling such as various times of the day, days of the week, and seasonally. Keeping a scheduled system helps contribute to predictable usage metrics. While workers are still able to override the system manually when needed, scheduling strategies are very much a useful tool for energy conservation.

Automated Maintenance

There are advanced systems that can offer greater warehouse energy oversight. Automated maintenance systems help managers take charge of lighting maintenance needs by tracking historical data, keeping track of energy usage trends, and lamp maintenance requirements.

Lighting control implementation and LED retrofits will serve some of the most substantial energy optimization goals for warehouses. To take strategies even further for a fully optimized warehouse energy plan that cuts additional costs and increases energy resiliency, let’s explore some final strategic measures for your warehouse energy tool belt.

Taking the lead from major brands, here’s a list of MW generation efforts.

Without significant upfront capital, and in some cases, no upfront capital, warehouses, and distribution centers can begin to leverage an energy strategy that drastically cuts costs. By focusing on LED retrofit and lighting control efforts, warehouse managers can use the efforts gained to create a highly competitive facility that incorporates strategic energy purchasing and on-site solar generation. Contact the A1 Energy team to answer your warehouse energy optimization questions.

Resources:

https://www.a1energy.net/blogs/post/Importance-of-C-and-I-Energy-Management

https://www.eesi.org/articles/view/pennsylvania-takes-a-step-toward-joining-northeast-carbon-cap-and-trade-program

https://www.manufacturing.net/home/article/13217187/reducing-energy-costs-in-warehouses

https://www.sdcexec.com/warehousing/article/12379689/sustainable-warehouses-from-led-to-hvac-to-solar-and-more

https://www.supplychaindive.com/spons/why-low-carbon-warehouses-are-even-more-important-than-you-thought/552052/

https://www.ashrae.org/technical-resources/aedgs

https://www.seia.org/research-resources/solar-power-purchase-agreements

https://www.forkliftcertification.com/creating-an-environmentally-friendly-warehouse/