In a handful of states, a solar system doesn't just cut the electric bill — it mints a tradable commodity called a Solar Renewable Energy Certificate, or SREC. Depending on the market, those certificates can be worth anywhere from a few dollars to several hundred dollars each, adding up to hundreds or even thousands of dollars a year. So when a solar home changes hands, an obvious question has a surprisingly murky answer: who keeps the SRECs? The seller who generated them? The buyer who now owns the panels? Or a third party the original owner signed them away to years ago? The deed doesn't decide this — the contract does, and most people never read it.
What an SREC actually is
One SREC is created for each megawatt-hour (1,000 kWh) of electricity a solar system generates. In states with a Renewable Portfolio Standard that includes a "solar carve-out," utilities are required to buy a certain number of SRECs to prove they sourced enough solar power — which creates a market where homeowners (or whoever holds the rights) can sell them. Critically, an SREC is separate from the electricity itself and from net metering: you can consume or export the power and earn a certificate for having generated it.
Where SRECs exist
SREC markets are state-specific and change over time, but the most active have historically included:
| State | Notes |
|---|---|
| New Jersey | Long-running market; successor programs (SREC-II / SuSI) for newer systems |
| Pennsylvania | Active market; prices vary widely with supply |
| Maryland | Established solar carve-out |
| Massachusetts | Legacy SREC programs plus successor incentives (SMART) |
| Washington, D.C. | Historically among the highest SREC values in the country |
| Ohio | Market exists; values generally lower |
Programs open and close to new systems over time; a home's eligibility depends on when and where it was installed. Always confirm current rules with the state program and registry.
Who keeps them after a sale — it's in the contract
Here's the key insight for anyone buying, selling, or listing a solar home: the right to the SRECs follows whatever the homeowner agreed to, not the property transfer by default. There are three common situations:
- The homeowner kept their SREC rights. If the system was purchased (cash or loan) and the owner registered the system in their own name, they generally own the SRECs. Unless the sale contract says otherwise, those rights typically pass to the buyer along with the system — but this should be stated explicitly, and the registry account must be transferred.
- The SRECs were signed away for an upfront payment or lower price. Many installers and aggregators offered a discount, rebate, or lump sum in exchange for the homeowner assigning 10, 15, or 20 years of SRECs to them. If so, neither the seller nor the buyer gets them — a third party does, often for the remaining term. The buyer inherits a system that generates certificates they'll never see.
- The system is leased or under a PPA (third-party owned). The third-party owner almost always retains the SRECs, because they own the equipment. The homeowner — and the buyer assuming the agreement — typically has no claim to them.
The registry is where it gets real
SRECs are tracked in regional registries (for the PJM region, that's the PJM-EIS Generation Attribute Tracking System, or GATS; New England uses NEPOOL-GIS). A system is registered to an account, and the certificates flow to whoever holds that account — or to an aggregator the owner designated. At a sale, transferring SREC rights means transferring or updating that registry account, which is a separate step from the real estate closing and is easy to overlook. If it isn't handled, the seller's old account may keep collecting certificates the buyer thought they were getting.
What agents and buyers should verify
- Is the home in an SREC state, and is the system still eligible? Eligibility depends on install date and program status.
- Who currently receives the SRECs? The homeowner, an aggregator, an installer, or the lease company?
- Was there an SREC assignment agreement? Ask for it. A one-time rebate years ago often means a long-term assignment.
- Does the purchase contract address SRECs explicitly? If the buyer is meant to receive them, say so and plan the registry transfer.
- Is the system leased or PPA? If so, assume the SRECs stay with the third-party owner unless proven otherwise.
A SolarDisclosure™ report flags the system's ownership and financing so you know whether SRECs, net-metering value, and warranties actually convey — before you're under contract.
See a sample closing report →Do SRECs add to home value?
Only if they convey. A system whose owner still holds transferable SREC rights in a strong market carries a modest recurring-income stream a buyer can value. A system whose SRECs were assigned away, or that's third-party owned, offers the buyer none of that upside — and pricing or marketing that implies otherwise can create a disclosure problem. The honest move is to document the SREC status alongside the net-metering and lien picture, so the home is presented accurately. For the broader resale mechanics, see our guides on net-metering transfer at resale and solar leases at closing.
Sources & further reading
- U.S. EPA — Solar Renewable Energy Certificates (SRECs)
- PJM-EIS — Generation Attribute Tracking System (GATS)
General information, not legal or financial advice. SREC programs, eligibility, and values vary by state and change over time — verify current rules with the state program and registry.