What is a Renewable Energy Certificate (REC) or Energy Attribute Certificate (EAC)? [OLD]
A Renewable Energy Certificate (REC) is a market-based instrument that is issued when a renewable energy source produces one megawatt hour (MWh) of electricity and delivers it to the grid in North America. As a type of Energy Attribute Certificate (EAC), a REC is a tool that provides authorized documentation, allowing the buyer to claim […]
- A Renewable Energy Certificate (REC) is a market-based instrument that is issued when a renewable energy source produces one megawatt hour (MWh) of electricity and delivers it to the grid in North America. As a type of Energy Attribute Certificate (EAC), a REC is a tool that provides authorized documentation, allowing the buyer to claim consumption of that specific energy and its various benefits, but is typically traded separately from the underlying electricity.
- To qualify as an EAC, the renewable energy must be generated by wind, solar, biomass, geothermal, or certain hydropower sources. For wind power generation, turbines are used to transform the wind’s kinetic energy into electricity. Biomass energy is plant-derived material that is used (typically burned) to produce heat or electricity. Geothermal energy is derived from heat within the earth that is captured to generate electricity. Hydropower harnesses the force of flowing water by capturing kinetic energy, which can be converted into electricity using turbines and generators. Solar power is energy from the sun that is converted into thermal or electrical energy. Solar RECs or SRECs are certificates that are distinctly designated for electricity that comes from solar technologies. SRECs can be sold separately from the electricity they produce, which means producers with rooftop solar arrays can use the electricity on-site, then sell the SRECs to utilities. This is more common in states that have passed renewable portfolio standards (RPS).
- There are new categories of EACs that have been developed to signify the environmental, social and other non-power attributes associated with renewable energy generation, like Peace RECs or P-RECs. P-RECs support emerging renewable energy projects in poorly electrified, climate-vulnerable countries where renewable energy investment remains limited. More specifically, a P-REC is an International Renewable Energy Certificate (I-REC) with a supplementary label from Energy Peace Partners certifying the project’s co-benefits. Issued under the I-REC standard, each P-REC represents 1 MWh of renewable energy generated, while also delivering social and economic co-benefits in the same community. To learn more about the benefits of P-RECs, read our case study.
