Green Power Purchasing Frequently Asked Questions (FAQ)
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What is a REC or a GO?

Short answer

A Renewable Energy Certificate (REC) or Guarantee of Origin (GO) is simply a recording of information created to document the fact that one megawatt-hour of electricity is generated and supplied (net) to the shared electrical grid through the use of specified and eligible renewable energy resources. No clear definition exists beyond this fundamental characteristic, although most definitions present some form of broader, yet ambiguous, claim regarding intangible “green” or “renewable” attributes. Some of these certificates may be used for regulatory compliance purposes by electric utilities, while in the United States a large residual is offered for sale to a voluntary market of corporate and other consumers with the marketing message that their purchase is equivalent to “buying green power” (see What am I receiving if I buy a voluntary REC or GO?).

Long explanation

In practice, a wide range of REC and GO definitions exist across green power marketers, regulations, legislation, and non-governmental certification organizations. Many of these definitions make reference to some manner of “attributes” or “benefits”, using terms like “green” and “renewable.”[1]

Originally, and appropriately, RECs were designed as a tool to track compliance with Renewable Portfolio Standard (RPS) (i.e., electric utility quotas for the supply of a minimum amount of renewable energy to the grid) regulations, while allowing electric utilities (i.e., Load Serving Entities) the flexibility of trading to facilitate more cost-effective industry-wide compliance. RECs used for RPS compliance in the United States must meet definitions and eligibility requirements that differ by jurisdiction, resulting in dozens of different types of compliance certificates. In all regulatory cases, though, RECs (USA) and GOs (Europe) are not used by governments to imply power is being physically transacted, but instead these certificates are used as a tradable regulatory compliance tracking instrument.

Voluntary market RECs and GOs, on the other hand, have been claimed by electricity end users (i.e., companies and individual customers of electric power companies) to represent the purchase of electrical energy from specific renewable energy generators, despite the reality that delivery of renewable energy to the grid is not necessarily contingent on their purchase.

[1] Gillenwater, M. (2008). Redefining RECs (Part 1): Untangling attributes and offsetsEnergy Policy.