we've got a better idea. we've also got a better REC.
Last updated November 05 2008.
It's estimated that $14 Billion was spent in 2007 on carbon offsets, and it's a safe bet that many of the people who bought them aren't sure what they spent their money on.
Carbon offsets give green energy supporters a way to subsidize green energy and diminish greenhouse gas production even if they can't choose a local green energy provider. Offsets work in a manner similar to "adopt a whale" programs: you spend money to buy certificates, and the money goes to help fund a green program. As with the whale, you'll probably never see the program you funded, and you might never even be on the same continent.
Together with the certificate, you get to say you've "offset" the carbon you produce in daily life. You may use electricity generated by coal-fired plants and drive a gasoline-fueled car, but the program you sponsored used the money you gave them to take some greenhouse gasses out of the system somewhere else. So you've evened the score.
RECs help green power compete on the open market.
Renewable Energy Certificates (RECs) are one kind of carbon offset. Specifically, they help green energy producers like wind farms and high-intensity solar installations compete on the open market to produce electricity. Without assistance, they can't compete with coal, gas and oil-fired plants. But the REC tips the market in their favor.
Certified green energy producers are allowed to sell one REC for every MWh of electricity they produce. The REC is priced so that they can lower the cost of their energy to a competitive level, and sell the REC to make up the difference.
Once power has entered the electric grid, there's no way to tell where it came from; it's part of a vast pool of energy. In fact, all the energy produced in the world is part of one giant pool. So if you calculate the amount of electricity you use in a year, and buy an equal number of RECs in addition, you can claim that you've bought all your electricity from renewable sources. You may not be able to trace a line from your wall socket to the wind farm, but you know that without the RECs, the wind power would never have been produced.
Community Green Energy RECs work twice as hard.
RECs are considered a tradable commodity, which means that anyone selling you a REC is taking a commission on the sale. This means that some of the money for the REC you buy is going into someone else's pocket.
However, every sale and every purchase you make through a Community Green Energy Initiative helps to fund Local Green Energy in your community. So when you purchase RECs through an Initiative, it's a double dip in green energy support. The REC supports the green energy source that issued it. And the Initiative puts its commission from the sale into a Local Green Energy project. That's what makes a Community Green Energy REC a better REC.
