Renewable energy certificates (RECs), also known as green certificates,
green tags, or tradable renewable certificates, represent the environmental
attributes of the power produced from renewable energy projects and are sold
separate from commodity electricity. Customers can buy green certificates
whether or not they have access to green power through their local utility or a
competitive electricity marketer, and they can purchase green certificates
without having to switch electricity suppliers.
RECs can be sold and traded or bartered, and the new owner of the REC can
claim to have purchased renewable energy. While traditional carbon
emissions trading programs promote low-carbon technologies by increasing the
cost of emitting carbon, RECs are an incentive for the promotion of
carbon-neutral renewable energy by providing a production subsidy to
electricity generated from renewable sources. It is important to
understand that the energy associated with a REC is sold separately and is
normally used by another party. The consumer of a REC receives only a
certificate, and not the actual energy produced, unless he purchases it
separately.
In states that have a REC program, a green energy provider (such as a wind
farm) is credited with one REC for every 1,000 kWh or 1 MWh of electricity it
produces (for reference, an average residential customer consumes about 800
kWh in a month). A certifying agency gives each REC a unique
identification number to make sure it doesn't get double-counted. The
green energy is then fed into the electrical grid (by mandate), and the energy
(and the accompanying REC) can then be sold on the open market
The United States Environmental
Protection Agency claims to have the highest percentage use of green power of
any federal agency. In 2007, it offset the electricity use of 100% of its
offices. The Air Force is the largest purchaser in the US government in
absolute terms, purchasing 899,142 MWH worth of RECs. Among colleges and
universities, the University of Pennsylvania in Philadelphia is the largest
purchaser of RECs, buying 192,727 MWH of RECs from wind power. The
corporate leader is Intel, with 1,302,040 MWH purchased in 2007, and the largest
purchaser among retailers is Whole Foods, which purchased 509,104 MWH, or enough
RECs to offset 100% of its electricity needs.
Authorized Dealer