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To understand Renewable Energy Certificates (RECs), it is important to understand what makes renewable energy desirable. Renewable power generated from clean sources like wind, solar or hydro facilities do not cause the environmental impacts most associated with conventional electricity generation. Unlike traditional power plants that use carbon dioxide emitting fossil fuels such as coal, oil or natural gas to create electricity, renewable resources rely on natural forces that have little or no impact on the environment. RECs act as a way to verify the creation of this clean form of electricity.
According to the Environmental Protection Agency, one REC avoids on average about 1,600 pounds of carbon dioxide (CO2) emissions. (For comparison, the average U.S. home is responsible for 1,233 pounds of CO2 emissions per month according to the U.S. Energy Information Administration.) Renewable energy also avoids the emission of other pollutants such as oxides of nitrogen and sulfur dioxide, both of which contribute significantly to ozone pollution and human health concerns.
RECs provide for the transfer of the environmental benefits associated with renewable energy between parties and are an important value stream for renewable energy projects. RECs are used to meet certain state renewable energy requirements, but also allow stakeholders to meet corporate sustainability or greenhouse gas emission reduction goals. Individuals who choose to mitigate their own impact on the environment can also benefit from RECs.
- RECs enable anyone, anywhere, to buy renewable energy, claim the emission avoidance associated with energy production and support renewable energy development
- RECs provide green power options in areas that may not be suitable for renewable resources, allowing renewable facilities to be located where they are the most efficient
- A REC is created when one megawatt-hour of renewable energy is produced from a qualified renewable energy generation plant
- RECs represent the energy's avoided emissions benefit when compared to energy being produced from a facility burning fossil fuels
- Only the owner of the REC can claim the environmental benefits of the clean energy production
- RECs help to fight climate change by reducing your carbon footprint
- RECs support both existing and future demand for clean renewable energy development by making it more cost-competitive
- RECs assure that more certified renewable energy is delivered to the power grid, thus requiring less fossil fuel sources to power our country's energy needs
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