RECs and Carbon Offsets: What’s The Difference?

People are sometimes confused by the fact that they can buy two different things to help fight global climate change: RECs and carbon offsets.

They’re similar, though not exactly the same. Both are tradable commodities. Both represent, and help subsidize, technologies that reduce overall concentrations of greenhouse gases. Much of the difference comes from the fact that two different groups of people developed the same idea at the same time, with slightly different results.

Wind turbines in America are allowed to sell RECs, because they produce electricity without pollution. In Europe and Asia, they sell offsets, because they help remove greenhouse gasses from the atmosphere by preventing them from getting there in the first place.

RECs, as we explained in What the HEC is a REC, are a commodity that represents the greenhouse gases that were not produced when one megawatt of electricity was generated by a clean, green generator. RECs are sold as a way to subsidize renewable green energy in America, and were created in America. They are measured in megawatt hours, though we can estimate a carbon equivalence for them as well.

Carbon offsets are also a commodity: they represent any technology that decreases the overall amount of greenhouse gas in the atmosphere. There are carbon offsets for electricity generated by green power sources…a REC can be considered one type of carbon offset…as well as for energy efficiency projects. These kinds of offsets decrease overall greenhouse gas levels by preventing the gases from being produced in the first place. There are also carbon offsets for things like reforestation projects, methane capture projects and halocarbon destruction which actively remove greenhouse gases from the atmosphere.

Programs that plant trees, which remove CO2 from the air, can apply to sell offsets. Because they don't produce electricity, they couldn't sell RECs.

Carbon offsets are sold as a way to subsidize greenhouse gas reduction anywhere in the world, and were a result of the 1997 Kyoto conference which produced the Kyoto Protocol. They are measured in pounds of carbon dioxide, or carbon equivalence.

Which should you buy? Obviously, Community Green Energy has a strong belief in RECs. RECs have a well-established verification process through Green-e® Energy, which is crucial for consumer confidence when you are buying a commodity. They also have an impact right here in America, which continues to be the world’s leading producer of greenhouse gases. And most important, by supporting green energy, RECs help to cut off greenhouse gases at the source.

If you’re looking to completely minimize your "carbon footprint," you can consider carbon offsets to supplement your REC purchase. RECs "green up" your electric use, but other activities also contribute to your footprint, such as when you ride in your car, take a plane to another city or heat your home (unless you use electric heat). Carbon offsets for these activities can help you reach a completely "carbon neutral" point. You can use one of  the many carbon calculators on the Web…for example, this link takes you to the carbon calculator on the site for An Inconvenient Truth…to find out what your total footprint is.

The results may surprise you! Remember, if you buy enough Community Green Energy RECs to match all your electric use, you can claim 100% wind power in the calculator.

You should research carbon offsets carefully before you buy. Community Green Energy is considering the many issues involved, including verification, proof of effectiveness, and certification. We may add carbon offsets to our site in the future. In the meantime, if you’d like to learn more, the PDF you’ll download when you click this link is a great place to start.You can also visit this web site.