Who Owns Renewable Energy Certificates?

Holt, Edward ; Wiser, Ryan ; Bolinger, Mark

Lawrence Berkeley National Laboratory

关键词: Financial Incentives;    Us Public Utility Regulatory Policies Act;    Marketers;    Economics;    Compliance;   

DOI  :  10.2172/922809
RP-ID  :  LBNL--60537
RP-ID  :  DE-AC02-05CH11231
RP-ID  :  922809

美国|英语

来源: UNT Digital Library

【 摘 要 】

Renewable energy certificates (RECs) are tradable instruments that convey the attributes of a renewable energy generator and the right to make certain claims about energy purchases. RECs first appeared in US markets in the late 1990s and are particularly important in states that accept or require them as evidence of compliance with renewables portfolio standards (RPS). The emergence of RECs as a tradable commodity has made utilities, generators, and regulators increasingly aware of the need to specify who owns the RECs in energy transactions. In voluntary transactions, most agree that the question of REC ownership can and should be negotiated privately between the buyer and the seller, and should be clearly established by contract. Claims about purchasing or using renewable energy should only be made if REC ownership can be documented. In many other cases, however, renewable energy transactions are either mandated or encouraged through state or federal policy. Because of the recent appearance of RECs, legislation and regulation mandating the purchase of renewable energy has sometimes been silent on the disposition of the RECs associated with that generation. Furthermore, some renewable energy contracts pre-date the existence of RECs, and therefore do not address REC ownership. In both of these instances, the issue of REC ownership must often be answered by legislative or regulatory authorities. The resulting uncertainty in REC ownership has hindered the development of robust REC markets and has, in some cases, led to contention between buyers and sellers of renewable generation. This article, which is based on a longer Berkeley Lab report, reviews federal and state efforts to clarify the ownership of RECs from Qualifying Facilities (QFs) that sell their generation under the Public Utility Regulatory Policies Act (PURPA) of 1978. The full report also addresses state efforts to clarify REC ownership in two other situations, customer-owned generation that benefits from state net metering rules, and generation facilities that receive financial incentives from state or utility funds. The issue of REC ownership most often arises in states that have adopted an RPS. In such states, both parties to QF contracts have a lot at stake: either additional cost to a utility if RECs are awarded to the QF, or loss of value to the QF if RECs are awarded to the utility. As a rough estimate, QF RECs that are eligible for state RPS programs could have a value between $35 million and $175 million, so there is significant economic value riding on the ownership question.