Renewable Energy Credits
Renewable Energy Certificates (RECs), also known as Green tags,
Renewable Energy Credits, Renewable Electricity Certificates, or
Tradable Renewable Certificates (TRCs), are tradable, non-tangible
energy commodities in the United States that represent proof that
1 megawatt-hour (MWh) of electricity was generated from an eligible
renewable energy resource (renewable electricity).
These certificates can be sold and traded or bartered, and the owner
of the REC can claim to have purchased renewable energy. While
traditional carbon emissions trading programs promote low-carbon
technologies by increasing the cost of emitting carbon, RECs can incentivize carbon-neutral renewable energy by providing a production subsidy to electricity generated from renewable sources. It is important to understand that the energy associated with a REC is sold separately and is used by another party. The consumer of a REC receives only a certificate.
In states that have a REC program, a green energy provider (such as a wind farm) is credited with one REC for every 1,000 kWh or 1 MWh of electricity it produces (for reference, an average residential customer consumes about 800 kWh in a month). A certifying agency gives each REC a unique identification number to make sure it doesn't get double-counted. The green energy is then fed into the electrical grid (by mandate), and the accompanying REC can then be sold on the open market.
Markets
Compliance markets are created by a policy that exists in 29 U.S. states, plus the District of Columbia, called Renewable Portfolio Standard. In these states, the electric companies are required to supply a certain percent of their electricity from renewable generators by a specified year. For example, in California the law is 33% renewable by 2020, whereas New York has a 24% requirement by 2013. Electric utilities in these states demonstrate compliance with their requirements by purchasing RECs; in the California example, the electric companies would need to hold RECs equivalent to 33% of their electricity sales.
Voluntary markets are ones in which customers choose to buy renewable power out of a desire to go green. Most corporate and household purchases of renewable energy are voluntary purchases. Renewable energy generators located in states that do not have a Renewable Portfolio Standard can sell their RECs to voluntary buyers, usually at a cheaper price than compliance market RECs.
The above information was taken from http://en.wikipedia.org/wiki/Renewable_Energy_Credits. Please visit the link for additional information about renewable energy credits.
Renewable Portfolio Standard
In Ohio, the Renewable Portfolio Standard (amount of electricity the utilities are required to produced from renewable energy) is the following:
| Year |
Renewable (%) Benchmark |
Solar (%) Benchmark |
| 2009 |
0.25 |
0.004 |
| 2010 |
0.5 |
0.010 |
| 2011 |
1.0 |
0.030 |
| 2012 |
1.5 |
0.060 |
| 2013 |
2.0 |
0.090 |
| 2014 |
2.5 |
0.12 |
| 2015 |
3.5 |
0.15 |
| 2016 |
4.5 |
0.18 |
| 2017 |
5.5 |
0.22 |
| 2018 |
6.5 |
0.26 |
| 2019 |
7.5 |
0.30 |
| 2020 |
8.5 |
0.34 |
| 2021 |
9.5 |
0.38 |
| 2022 |
10.5 |
0.42 |
| 2023 |
11.5 |
0.46 |
| 2024 |
12.5 |
0.50 |
| At least 50% of the renewable energy requirement must be met by in-state facilities, and the remaining 50% with resources that can be shown to be deliverable into the state. |
REC pricing can vary daily. As a result, please visit the following websites for more information about REC's and their present day value:
http://www.srectrade.com/
http://www.flettexchange.com/
http://www.solsystemscompany.com/