Renewable Energy Certificates (RECs)
Renewable-energy projects use renewable resources to generate electricity. In this context, such projects develop both electricity and the “green attributes” associated with production of renewable energy. The electricity is sold to a utility; whereas, the green attributes, which form the REC, may be sold to a utility or to a company that wishes to offset its electricity-related emissions.
Typically, however, RECs are sold to utilities either to help them comply with the Renewable Portfolio Standard (RPS) of a particular state or to help them comply with their own customer-driven, green-power initiative.
RECs range in value from $5.00 - $10.00 in Oregon and Washington, to $20.00 in California, to as much as $60.00 per REC in Massachusetts. When sold together with the electricity, RECs that are generated in one state may be sold into another state. With this in mind, it is wise to seek professional guidance before deciding where, when and how to sell a project’s RECs.
Technologies that can lead to development of RECs include the following:
- combustion of biogas (e.g.: from an anaerobic digester);
- combustion of woody biomass;
- wave / tidal.