What is a REC?

In today's electricity market, companies are focusing on reducing their carbon footprint, so sourcing renewable energy has become increasingly important. Imagine if your company could guarantee that its electrical power comes from renewable energy sources that do not produce greenhouse gas (GHG) emissions. This goal can be achieved with a Renewable Energy Certificate (REC).

The Electricity Grid: Understanding the Foundation

To grasp how RECs work, it's essential to understand the electricity grid's structure. The grid operates as a vast, interconnected network where electricity from multiple sources—renewable and conventional—flows together through transmission and distribution lines. Once electricity enters the grid, it becomes challenging to trace specific electrons from their source to their destination. This is where RECs become invaluable because they allow you to claim the environmental benefits of renewable electricity generation.

How RECs are Created and Tracked

Every time a renewable energy facility generates one megawatt-hour (MWh) of electricity, a corresponding REC is created and entered into a tracking system. These certificates contain detailed information including:

• Generation facility location and type

• Date and time of generation

• Unique serial number for tracking

• Environmental attributes

Purchasing RECs

When you purchase a REC, you gain exclusive ownership of those environmental attributes. Upon purchase, the REC is permanently "retired" from the tracking system, preventing any other party from claiming the same renewable energy benefits.

Bundled vs. Unbundled RECs: Understanding Your Options

RECs can be purchased in two ways:

Bundled RECs include both the physical electricity and the environmental attributes. This typically occurs when you purchase electricity directly from a renewable energy project through a power purchase agreement (PPA) or choose a green energy option from your utility.

Unbundled RECs represent only the environmental attributes, sold separately from the physical electricity. This option provides flexibility, allowing you to maintain your existing electricity supply while still supporting renewable energy development and claiming its environmental benefits.

The Role of RECs in the Energy Industry

RECs play a crucial role in enhancing our green footprint. When someone purchases a REC, they support renewable energy sources, which can help facilitate the growth of other renewable projects. The more power we obtain from renewable sources, the more we can reduce greenhouse gas (GHG) emissions across the country.

Ready to explore how RECs can help your organization achieve its sustainability goals? Contact our business development team to discuss customized renewable energy solutions that align with your specific needs and objectives.