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Registering Renewable Energy Generation for Tracking and Ultimate Sale of Renewable
Energy Credits (RECs)
Tom Mossinger – Carollo Engineers PNCWA 2012
2012 Annual Conference Boise, ID
October 22, 2012
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What Are Renewable Energy Credits?
• RECs are a means to track and manage renewable energy generation
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And Why Are They Important?
• Allows for compliance with renewable portfolio standards
• Supports regulatory compliance
• Substantiates renewable energy generation claims
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Renewable Energy Credits (RECs)
• In the western US RECs are typically “banked” by WREGIS – Western Renewable Energy Generation Information System
• REC can be retired, reserved or exported to other tracking systems
• RECs are traded openly on various markets across US • All renewable power is eligible for participation in the
REC market • Value depends on when, where and how RECs are
generated • Only electrical energy generated from renewable
sources is eligible
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North American REC Markets
Current Certificate Tracking Systems
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REC Purchasers
• Power companies often purchase RECs to meet RPS requriements
• Third parties purchase RECs on the open market
• RECs are typically sold by brokers in bundles of 10,000 RECs or more
• Current value per recent discussions with brokers is between $1 and $35 per REC
California’s new TREC market could raise value to as much as $50/REC
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How Are RECs Generated?
• 1 MW-hr of renewable power = 1 REC
• Includes all environmental and renewable attributes
• Energy sources include: – Hydro (sometimes!)
– Solar power
– Wind power
– Power generated using renewable fuels • Biomass (green wastes/trees/saw grass/etc.)
• Biogas (digester and landfill)
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How Do We Track Our RECs?
• Generate renewable power
– Solar, wind, small hydro and/or digester/landfill gas
• Get “Eligible Renewable Facility” certification with CEC
• Create an online account with WREGIS
• Track and manage RECs
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Who is Tracking RECs?
• LACSD – Engines and turbines at landfills and WWTPs
• Monterey Regional Water Pollution Control Agency – Solar and engines at WWTP
• Eastern Municipal Water District – Solar and fuel cells at WWTP
• Rancho California Water District – Solar
• Many Others
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REC Accounts
• Accounts are set up within the local electricity grids
• Western Electricity Coordinating Council (WECC)
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• The Western Renewable Energy Generation Information System (WREGIS) is an independent, renewable energy tracking system for the region covered by the Western Electricity Coordinating Council (WECC)
• WREGIS tracks renewable energy generation from units that register in the system using verifiable data and creates renewable energy certificates (RECs) for this generation
• WREGIS Certificates can be used to verify compliance with state and provincial regulatory requirements (Renewable Portfolio Standards, for example) and in voluntary market programs
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WREGIS Account Set-up Procedure
• Register with www.wregis.org
• Complete and mail Account Registration Packet and application fee to WREGIS
– $250 for less than 1 MW
– $850 for 1 MW to 10 MW
• Receive confirmation email
• Register generation units
• Confirm/install gas and power meters meeting WREGIS requirements
• Send verification packet
• Receive final approval from WREGIS
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Gas and Power Meter Compliance Requirements
• Power Meters – Power meters meeting
ANSI C-12
– Accuracy requirements 2% or better
• Fuel Meters – Dedicated Fuel meters for
each generation unit if using renewable fuel along with NG,
– Typical accuracy +/- 1% Fuel Meter
Power Meter
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CEC Registration
• Get “Eligible Renewable Facility” certification for California’s RPS program participation
• This Certification allows REC trading with utilities with mandatory RPS program participation
• Complete CEC form CEC-RPS-1A
• http://www.energy.ca.gov/2007publications/CEC-300-2007-006/forms/CEC-RPS-1A-S1-Biofuels.pdf
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CEC Certification Application
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Tracking RECs Once Registered
• REC production is reported monthly
– Generators less than 360 kW can be self reported
– Larger systems must be reported by a Qualified Reporting Entity (QRE)
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What is a QRE?
• Qualified Reporting Entity
• QRE Candidates: Balancing Authorities
Load Serving Entities (Utilities)
Generator Aggregators
Meter Readers
Independent Third Party Company
• QRE’s must be registered with WREGIS
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Qualified Reporting Entities
• Most utilities are certified QREs – They will provide QRE service for free for projects
which they are buying RECs
• Other third party firms have to be certified to be QREs – These firms provide QRE service for a fee; typically
$4,000 to $6,000 for 1 MW – 2 MW systems
• Facility owners could become certified as a QRE if desired – Typically only done by large power generators
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Example Third Party QREs Registered with WREGIS within WECC Region
• Fat Spaniel Technologies
• VIASYN Services
• Trimark Associates
• California ISO
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Once Generated and Deposited with WREGIS; Now What?
• Use to meet mandatory GHG emission reductions
– “Retire” RECs to meet mandated GHG reductions
– “Export” RECs to other compatible tracking systems
– WTP & WWTP’s are currently not expected to be required to meet mandated reductions
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Once Generated and Deposited with WREGIS; Now What?
• Sell Them! – “Transfer” to other WREGIS account
holder
– “Reserve” to transfer it to non-compatible tracking systems or users
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How are RECs Sold
• Most purchases are for large blocks (10,000 RECs or more)
• Solicit purchase (RFP)
• Sales typically through brokers
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REC Example Calculation
• Assumed Solar Generation System: – 1,000 kW solar generator output
– Assume 25% operating effectiveness
• Assumed Biogas Engine Generation System: – 300 kW solar generator output
– Assume 85% operating availability
1,000 kW x 8,760 hr/yr x 0.25 = 2,190,000 kWh 2,190,000 kWh/yr / 1,000 kW/MW = 2,190 MWh/yr
2,190 MWh = 2,190 RECs
300 kW x 8,760 hr/yr x 0.85 = 2,230,000 kWh 2,230,000 kWh/yr / 1,000 kW/MW = 2,230 MWh/yr
2,230 MWh = 2,230 RECs
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RECs Provide Significant Revenue
REC Value $1/REC $10/REC $50/REC
REC Value* (1000 kW solar or 300 kW biogas engine generator systems)
$ 2,200 $ 22,000 $ 110,000
Broker Fee (5%) $ (220) $ (1,100) $ (5,500)
WREGIS Fee $ (850) $ (850) $ (850)
QRE Fee $ (0) $ (0) $ (0)
Total Annual Revenue
$ 1,130 $ 20,050 $ 103,650
*REC value = (MW) x (hr/yr) x (value, $/MW-hr)
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Frequently Asked Questions on RECs
Question Answer
If I sell my RECs does it conflict with GHG reduction credit?
No
Is there risk to the owner (District, Agency, City)?
Yes and No
Are other agencies doing this? Yes
Does Carollo have experience assisting with REC reporting and sales?
Yes
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Questions?
