Green certificate (Energy)
Green certificate
Green certificates, also known as renewable energy certificates, are electronic or paper representations of the environmental attributes of electricity generated from approved 'green' or 'renewable' energy power plants. The environmental attributes– for example, reduced emissions of pollutants– are determined by comparing the environmental impact of the green or renewable energy power plant with the environmental impact, on average, of all power plants in the system. Social attributes are occasionally included as well; they could include, for example, reduced displacement of people. In many cases, each green certificate has a face value of one megawatt hour (MWh) of electricity generated at a qualified green or renewable energy power plant. The certificates distinguish the environmental attributes of the electricity from the electrons (that is, the 'power attributes') of the electricity. Each– that is, the green certificates and the electrons– can usually be sold separately in different markets. The purchase of green certificates can help electricity producers and consumers meet their renewable energy obligations (where applicable), even when not sourcing electricity directly from a renewable energy power plant. In jurisdictions without obligatory renewable energy targets, green certificates– marketed to, for example, firms advancing 'corporate social responsibility' goals– can help stimulate voluntary purchases of renewable electricity. Alternative terms used to describe green certificates include green tags, renewable energy certificates or credits, or tradable renewable certificates. Green certificates have been used in many countries in Europe, as well as Australia and the United States.
Further Reading
- U.S. Department of Energy. Green energy certificates.
