Renewable Energy Certificate Purchases Expected to Continue Rapid Growth

A high volume of renewable energy certificates (REC) is being purchased, a trend that is expected to increase by as much as five times in 2022, according to Transparent Energy.

The online energy procurement company says the expected growth shows the adoption of RECs being an important part of the decarbonization efforts of large energy buyers. Transparent Energy has sold 2.6 million RECs since May 2020 across industrial, commercial and institutional areas.

The company says RECs can be a bridge to power purchase agreements (PPAs) with renewable generators that may take years to develop and a near term way to add renewable energy to a company’s sustainability transitions.

Transparent Energy says using RECs, which it sells in an online auction platform, is a way for organizations to offset the emissions of their energy use while making an investment in the growth of renewable energy.

An REC is issued for every megawatt hour of electricity generated and delivered to the grid from a renewable energy source, according to the EPA. RECs give owners property rights to the renewable aspects of power generation and can be sold separately from the actual electricity, the agency says.

With the growing demand for renewable energy resources, comes volatility in the market. A recent report by Edison Energy shows REC prices rose from $1 to $2 a unit in the first quarter of 2021 to as high as $7 in August before falling again. PPAs in North America and Europe also were up 19% in the third quarter of 2021 compared with the same period last year.

A variety of organizations have been using RECs this year to improve their renewable energy objectives. The NHL’s Philadelphia Flyers used them to help power a practice facility and PepsiCo and Best Buy were among companies that signed a long-term REC agreement with to help with a solar power project in Texas.

Transparent Energy says its sales have helped green more 2.6 billion kilowatt hours of electricity.

“It’s easy for large energy buyers to think that on-site solar installations or PPAs are the only way to reach their net zero carbon goals, but RECs provide immediate value to the purchaser’s carbon bottom line,” says Transparent Energy President Luke McAuliffe.

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–> This post appeared first on Environment + Energy Leader.

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