Policy · Analysis
I.How the two tiers are drawn
Tier I is the list that looks the way you would guess. It holds solar, both the photovoltaic panels on roofs and solar thermal systems that heat water, along with wind, low-impact hydro (small dams that do not badly disrupt a river), geothermal, and biomass. A handful of narrower sources ride along, including methane captured from old coal mines and from landfills.
The second tier is where the surprises live. It counts waste coal (the leftover culm and gob piles from Pennsylvania's mining past, burned for power), large-scale hydropower from big dams, municipal solid waste (household trash burned at a waste-to-energy plant), and demand-side programs that pay customers to use less. Note the split on water: a small, gentle dam lands in Tier I, while a big one lands in Tier II.
II.Why trash and waste coal made the cut
Pennsylvania wrote this law in 2004, and the two-tier shape was a compromise. The state had, and still has, mountains of waste coal left from a century of mining, and burning those piles to make power was framed as cleaning up a legacy mess. Municipal waste earned a place for a similar reason: the Delaware Valley already burned much of its trash for electricity, including at the Covanta plant in Chester, now operating under the Reworld name, just down the Delaware River from the city.
Run the honest math and the tiers matter. At full phase-in, reached around 2021, the standard asks PECO for roughly 18 percent of its retail power from alternative sources, split into about 8 percent Tier I and about 10 percent Tier II, with a solar carve-out of roughly half a percent, per the Commission's figures. The larger slice sits in Tier II, which is not the clean power most readers picture when they hear the word.
III.What your roof prints
A rooftop array in Philadelphia does not just cut your bill. For roughly every megawatt-hour it generates, it earns one solar alternative energy credit, a tradable certificate that counts toward the solar carve-out. Those credits are created and tracked in PJM-EIS GATS, the attribute system run by the regional grid operator's information arm, and PECO buys them to meet its yearly solar share.
Your next step depends on what you want from the system. Most installers register your array in GATS and either sell the credits for you or let an aggregator do it; the price swings a lot, so treat any quoted figure as a guess, not a guarantee. To see how the whole standard is performing, the Commission's annual AEPS compliance report is the public document where the real numbers land.
IV.Worth watching this month
1. The PUC's annual AEPS compliance report, usually posted in the colder months, shows how close PECO came to its targets, and it is where the official numbers live (routine, but useful).
2. Any bill in Harrisburg to raise the standard above its roughly 18 percent plateau, an idea that has stalled more than once, so treat movement as real news (uncertain, matters if it happens).
3. Solar credit prices on the PJM-GATS market, which move week to week and set what your roof's certificates fetch (routine).
4. Whether the Department of Environmental Protection adds or removes any facility from the qualifying lists, a rare step that changes what counts (rare).
5. PECO's next default service rate filing, which folds in what it paid for alternative credits and eventually reaches your bill (routine, scheduled).
Frequently asked questions
- Does PECO have to buy only clean power under this law?
- No. The mandate counts two tiers, and Tier II includes waste coal, large dams, and burned municipal trash. So a real share of the alternative power the law requires is not what most people would call renewable.
- Is my rooftop solar Tier I or Tier II?
- Tier I, in the solar carve-out specifically. Each megawatt-hour it generates roughly earns one solar alternative energy credit that utilities need to meet the solar share.
- Who decides what qualifies?
- The Public Utility Commission runs the standard, and the Department of Environmental Protection helps judge which facilities meet the definitions. The two tiers themselves are written into the 2004 statute.
- What is an alternative energy credit worth?
- It depends. Solar credits have traded anywhere from a few dollars to much more over the years, and the price moves with supply and demand on the tracking market, so there is no fixed figure.
- Did the required share keep rising?
- It climbed on a schedule through about 2021 and then leveled off near 18 percent total. Unless the legislature changes the law, the required share stays roughly flat.
Sources on the bench
Pennsylvania PUC, Alternative Energy Portfolio Standards The state regulator's own page on the standard, with the tier rules and the annual compliance reports that show how utilities measured up. · www.puc.pa.gov/filing-resources/issues-laws-regulations/alternative-energy-portfolio-standards-aeps
Pennsylvania DEP, Alternative Energy The environment department's guidance on which facilities and technologies qualify under the law. · www.dep.pa.gov/Business/Energy/OfficeofPollutionPrevention/AlternativeEnergy/Pages/default.aspx
Pennsylvania General Assembly, Act 213 of 2004 (AEPS Act) The actual statute, where the Tier I and Tier II source lists are spelled out in the law's own words. · www.legis.state.pa.us/cfdocs/legis/li/uconsCheck.cfm?yr=2004&sessInd=0&act=213
PJM-EIS GATS The regional grid operator's attribute tracking system, where alternative energy credits, including solar, are created, traded, and retired. · www.pjm-eis.com
PECO, residential energy and solar The local utility's customer pages on rates, default service, and connecting rooftop solar to the grid. · www.peco.com