Everything You Need To Know About REC
No, not a collision but rather a platform that your company can advertise. As noted in last month’s editorial, we are thrilled to offer a portfolio of corporate-sponsored energy initiatives that help sustainability. I will expand on each of the offerings over the coming months on how your company can take advantage of these resources. This month we introduce the Renewable Energy Certificate (REC), sometimes called a Renewable Energy Credit.
What is a REC?
It is a tradable, legal mechanism that represents the environmental benefits associated with one Megawatt-hour of electricity generated from a renewable energy resource such as solar, wind, bio and hydro. These certificates may be sold and traded and the owner of the REC can legally claim to have purchased renewable energy. RECs incentivize the production of renewable energy by providing a source of revenue to electricity generated from renewable sources.
How do RECs work?
For every unit of renewable electricity generated, an equivalent number of RECs is produced. The purchase of RECs helps replace fossil fuel-based electricity generation in the region where the renewable electricity generator is located.
When a renewable energy facility operates, it creates electricity that is delivered into a vast network of transmission wires, often referred to as “the grid.” The grid is segmented into regional power pools; in our region, it is the ISO New England. It helps to facilitate the sale of renewable electricity nationally. A system was established that separates renewable electricity generation into two parts: the electricity or electrical energy produced by a renewable generator and the renewable “attributes” of that generation. The renewable attributes or “green” attributes can be sold separately as renewable energy certificates (RECs). Only one certificate may be issued for each unit of renewable electricity produced. The electricity that was split from the REC is no longer considered “renewable” and cannot be counted as renewable or zero-emissions by whoever buys it.
This product is comprised of RECs. With the purchase of RECs, you are buying the renewable attributes (i.e. environmental benefits) of a specific amount and type of renewable energy generation. You will continue to receive a separate electricity bill from your utility (if applicable). Your purchase of renewable certificates helps offset conventional electricity generation in the region where the renewable generator is located. Your purchase also helps build a market for renewable electricity and may have other local and global environmental benefits such as reduced regional air pollution and global climate change.
Renewable Energy Certificates are certified by Green-e Energy. Each supplier of Renewable Energy Certificates is required to disclose the quantity, type and geographic source of each certificate, available on the Product Content Label. Green-e Energy also verifies that the Renewable Energy Certificates are not sold more than once or claimed by more than one party. For information on Green-e Energy please visit its website, www.green-e.org.
1 REC = the non-power environmental attributes of 1,000-kilowatt-hours (1-Megawatt-hour) of renewable energy
Finally, we provide you with a proof of purchase certificate by email to ensure that only you own the environmental attributes associated with your REC and to confirm the project supply from which your REC was generated. Finally, we encourage you to get the word out on how your company is helping in a greater cause.
If you’d like to learn more about RECs please feel free to shoot us an email, alternatively find out more through our website here.
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