What is a REC
What are Renewable Energy Certificates (AKA 'RECs' or 'Green Tags')?
HOW THEY ARE CREATED
Tradable Renewable Certificates, Renewable Energy Credits (TRCs or RECs) also known as “green tags”, are created when a renewable energy facility generates electricity. Each unique certificate represents all of the environmental attributes or benefits of a specific quantity of renewable generation, namely the benefits that everyone receives when conventional fuels, such as coal, nuclear, oil, or gas, are displaced. You usually buy certificates from someone other than your electricity provider. What you pay for when you buy renewable energy certificates is the benefit of displacing other non-renewable sources from the regional or national electric grid.
THINK OF IT LIKE THIS:
When a wind turbine goes online, a coal-burning power plant turns down its dirty energy production, thereby reducing the overall carbon pollution in the world. You get credit for the reduction in pollution associated with your investment in this turbine.
Renewable energy has two components: the energy commodity and the corresponding green power attribute. The Energy Commodity is the actual electricity produced at facilities that generate the renewable electricity.
1 REC EQUALS 1,000 KILOWATT HOURS
A Renewable Energy Certificate ('REC') represents the environmental attributes (benefits) associated with 1,000 kilowatt hours of generation from a renewable electricity source like wind turbines and Photovoltaic cells. RECs allow their purchasers to support renewable energy projects even if the purchaser does not use the actual renewable electricity.
