ZEITGEIST: Selling Renewable Energy Credits

Selling Renewable Energy Credits by Jeff Fisher

Selling renewable energy credits is a new and interesting market. Here is some information about selling renewable energy credits and a basic understanding of the market.

Renewable Energy Certificates (RECs) are frequently referred to as Green Tags, Renewable Energy Credits, and/or Tradable Renewable Certificates (TRCs). RECs represent the environmental and economic value of electricity produced from clean, renewable, emission-free energy resources that will never be depleted and are safe for our environment. The REC is not actual energy, just the right to say that you have offset the production of dirty power for clean power.

Producers of green power should consider selling renewable energy credits as well as the power itself, which will increase their profits. Other parties can buy RECs if they need to satisfy regulatory requirements or improve their corporate appearance. When RECs are sold, the organization buying the RECs obtains the right to claim environmental advantage.

RECs allow energy users all across the country to support alternative energy generation. RECs contribute to the growth of the renewable power sector, and with buyer support will continue to help make alternative power even more cost competitive.

In areas which have a REC program, an alternative energy provider (such as a wind farm) is credited with one REC for every 1,000 kWh or one MWh of electricity it creates. The average residential customer uses about 800 kWh per month. A certifying organization gives each REC an exclusive identification number to make sure it isn't sold twice. The green energy is then fed into the electrical grid (by law), and the complementary REC can then be sold on the open market.

Several certification and accounting associations attempt to ensure that RECs are correctly tracked and confirmed and are not sold more than once. The Climate Neutral Network, Green-e, and the Environmental Resources Trust's EcoPower Program certify RECs. If you are interested in selling renewable energy credits, start with your local electric company or one of these organizations.

There are two main markets for RECs in the United States - compliance markets and voluntary markets.

A policy called the Renewable Portfolio Standard (RPS) is responsible for creating the compliance markets. Renewable Portfolio Standard requires electric companies to supply a predetermined percent of their electricity from renewable sources by a specific year.

For example, California electric companies must provide 20% energy from renewable sources by 2010. Electric utilities in these areas with RPSs must demonstrate compliance with their requirements by buying RECs. In the California sample, the electric companies would need to hold RECs equivalent to 20% of their sales.

Want to help companies and property owners go green? Sell your RECs on the voluntary market. Voluntary markets allow customers choose to purchase renewable power, generally out of a desire to go green. Most commercial and domestic purchases of RECs are voluntary. Alternative power providers can sell their RECs to voluntary buyers, usually at a lower price than compliance market RECs.

Detractors indicate a flaw with this system. The problem in this system is that it does not necessarily replace dirty energy. Since some alternate energy resources, most notably wind resources, are irregular and unpredictable, their production does not replace an equivalent amount of other sources, per kW of capacity. However, they do replace on a per kWh basis, electricity from combustion sources, thus reducing greenhouse gases and undesirable byproducts.

Jeff Fisher is a renewable energy enthusiast and the owner of http://www.renewableenergysimplified.com. Harness the renewable energy of the wind and sun to eliminate your power bill. Find our complete guide at http://www.renewableenergysimplified.com.

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SOLAR ENERGY: Solar Grants and Incentives

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Solar Grants and Incentives by Michael AE Whitney

Many governments and utility companies around the world are now offering various financial incentives to install new energy-efficient appliances such as furnaces and water heaters. Some of these programs also offer various types of incentives to install solar electric panels (photovoltaic panels) and solar heating systems.

Two countries that have had great success in increasing their use of renewable energy and fostering a "green" economy are Germany and Japan. Both countries have developed a thriving domestic solar industry, employing tens of thousands of people, by creating a demand for solar products through the use of various incentives.

However, for the average consumer seeking to determine the cost effectiveness of using solar technology, the incentives offered by various levels of government and utilities, can prove to be a daunting task.

Generally speaking, the types of incentives can be grouped into the following categories:

Grants and Rebates

• Numerous grants or rebates may be available in your jurisdiction through various programs that may be sponsored by the federal government, state government, regional government or by the utilities. The goal is to reduce the upfront cost of installing solar systems, thereby reducing the payback period for such systems.

Low Interest Loans

• Some jurisdictions may provide low or no interest loans for solar installations. This can greatly influence the time it takes to reach a break even point from a financial perspective.

Feed in Tariffs

• Some jurisdictions have mandated that utilities pay a premium for electricity generated from renewable resources. Premiums vary by jurisdiction, but can be 5 to 20 times the going rate for utility generated electricity. For example, in Ontario, Canada, the utilities have to pay 42 cents per kilowatt/hour for electricity generated from solar panels. Traditional grid power costs about 6 cents per kilowatt/hour.

Net Metering

• Any electricity generated from a solar panel that is fed back into the grid is credited at the going rate. The difference between energy consumed by the household and energy created by the household is what the householder will pay.

Tax Incentives

• Some jurisdictions may have provided an accelerated depreciation schedule for the capital cost of solar panels.

Given the complexity of the various incentives and grants available, it is probably prudent to consult a solar installer if you are considering installing a solar system. The solar installer should be knowledgeable in the grants and incentives that are available in your jurisdiction.

For more information on the uses of solar energy, please visit http://www.residentsolar.com

My name is Michael Whitney. I have had a keen interest in renewable energy technologies since I was in high school in the 1970's. Utilizing solar power provides a great opportunity for homeowners to get involved in reducing their impact on the environment.

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