RECs 101: What Are Renewable Energy Certificates?

Have you ever wondered how you can support clean energy without adding solar panels or wind turbines on your property? Renewable energy certificates (RECs) make it possible! RECs are an easy way to help boost renewable energy production, even if your home runs on regular electricity.

In this guide, we’ll explain RECs, how they work and why they’re a valuable solution for supporting a cleaner future.

What is a REC?

The U.S. Environmental Protection Agency (EPA) defines a renewable energy certificate as “a market-based instrument that represents the property rights to the environmental, social and other non-power attributes of renewable electricity generation. RECs are issued when one megawatt-hour (MWh) of electricity is generated and delivered to the electricity grid from a renewable energy resource.”

Basically, it’s a way to track and prove that electricity was generated from a renewable energy source (like solar, wind or hydropower).

When a REC is purchased, the buyer pays for the environmental benefits of renewable energy, even though the energy they use may come from traditional sources like coal or natural gas.

How do RECs work?

Since electricity from the grid isn’t separated by source — i.e., renewable vs. non-renewable — RECs help track and verify consumers’ use of renewable energy.

When a renewable energy facility, like a wind or solar farm, generates electricity, it produces electricity and a REC for each MWh generated. These certificates are then sold to people or companies who want to support clean energy. It’s like a receipt saying, “I/We have added renewable energy to the grid.” So, even if you don’t have solar panels on your roof, you can still buy RECs to “offset” your use of traditional, less-clean electricity sources.

RECs vs. carbon offsets

You may have heard of carbon offsets mentioned in relation to RECs. They both help the environment, but they’re a bit different.

While RECs are linked to clean energy production, carbon offsets cancel out carbon dioxide (CO₂) emissions from electricity production by absorbing equal amounts of carbon and other greenhouse gases from the atmosphere.

One carbon offset represents one metric ton (about 2,200 pounds) of greenhouse gas emissions reduced or recaptured through activities like:

• Nature-based solutions like afforestation, reforestation, grasslands and improved forest management
• Infrastructure projects that speed up the shift to renewable energy and decrease dependence on fossil fuels
• Health and livelihood projects that help bring clean water and air to communities (often those that are most affected by climate change but least responsible for causing it)

What are the drawbacks of RECs?

While RECs offer many benefits previously discussed, some people note that green energy certifications have a few drawbacks:

• RECs don’t offer you direct access to clean energy. They allow you to support clean energy, but ultimately, the actual power in your home may still be coming from non-renewables.
• RECs aren’t as tangible as solar. They might not be as appealing to some people as much as rooftop solar or other visible clean energy solutions.
• RECs can be confusing. Many people aren’t familiar with RECs (hence this article!), so they may not understand how RECs can make a difference even when still getting electricity from the grid as usual.

Overall, these disadvantages are easy to overcome if you know how clean energy certificates work and are willing to let your environmental support go unseen.

How RECs impact home electricity

You might be thinking, how do renewable energy certificates fit into my daily life? The average American home uses about 10,800 kilowatt-hours (kWh) per year, or 10.8 MW. If you want to support renewable energy, buying RECs can accomplish that. Simply look at your annual energy usage (1,000 kWh = 1 MWh) to determine how many RECs it would take to match your usage.

In short, RECs are a convenient and powerful way to support the transition to cleaner energy and help lower carbon emissions — even if you don’t own solar panels or wind turbines.

To learn more about what retailers sell renewable energy or offsets, visit third-party certifier Green-e®. 

Conclusion

Now that you know what renewable energy certificates are, it’s easier to understand how a clean energy plan can help you support the environment and lower your carbon footprint.

To search for renewable or traditional electricity plans in your area, check out Everything Energy.