Companies and other organizations should make decisions that produce positive change in the world and for the climate. Their financial decisions regarding their purchase of electrical energy services may be able to affect change for the better. Quantifying such impacts should be done through the application of an environmental impact analysis using a consequential GHG accounting method (e.g., a project-based methodology). Specific guidance on other procurement options for achieving more credible emission reductions impacts can be found here.
Based on evidence, purchasing voluntary market RECs and GOs does not result in positive change for the environment. It is possible that other financial arrangements like PPAs, under certain conditions, may produce a desired change (e.g., influence how much renewable energy is generated), but we lack evidence of under what conditions and whether this is the case. For the purpose of quantifying an organization’s GHG emissions, the application of green power purchasing claims (entailing an exclusive transfer of energy) is inappropriate. Companies should use consequential accounting methods to evaluate and report on the impact of their decisions and investments.