renewable energy industry growth
renewable energy credits (RECs), also known as credits, green certificates, green tags, or tradable renewable certificates are certified marketable proof that one MWh of electricity has been generated by a renewable source of fuel.
Customers can purchase green certificates or have no access green energy through local utility or a competitive electricity marketer, without having to switch electricity supplier, thereby REC purchase and sale which are independent of geography.
Renewable Portfolio Standard (RPS) / Renewable Electricity Standard (RES)
renewable energy credits are essential to the RPS (also known as CAP). The RPS requires all electricity generators (or electricity retailers, depending on the design of policies) to demonstrate, through ownership of credits, which have supported the amount of renewable energy generation equivalent a percentage of total MWh of annual sales. For example, if the RPS is set at 10%, and a generator sells 100,000 mwhs in a given year, the generator should have 10,000 credits at the end of that year. Renewable energy credits are a commodity and the price of the RECs vary mainly by supply and demand within a state / region and how regional economic communities are packaged for sale.
Renewable Portfolio Standard (RPS) is a flexible, policy driven by the market that can ensure that the public benefits of wind, solar, biomass and geothermal energy. It also ensures that the renewable energy generation continues to be recognized and used as electricity markets become more competitive. The policy requires that a minimum amount of renewable energy is included in the portfolio of electricity resources serving a state or country, and – by increasing the required amount in time – the RPS can put the electricity sector on the path towards sustainability on the rise. Because it is a market standard, the RPS relies almost exclusively on private sector markets electricity at wholesale and less for its implementation. Application in the private market will result in competition, efficiency and innovation that offer renewable energy at the lowest possible cost. The CAP has a predictable competitive market, generators of renewable energy in competing to reduce prices (such as renewable energy is generated within a state or region, it also generates more CER, ultimately driving the cost of RECs in the region of the state / a reduced with increasing supply). Mandatory RPS policies currently exist in 29 U.S. states and the District of Columbia.
As renewable energy generators automatically earn credits (RECs), which actually earn extra income from the sale of credits. With these loans have to be purchased by generators electricity or compensate retailers for the electricity generated from renewable sources (ie, mostly fossil fuels). Therefore, a Mandatory RPS directly benefits the growth of wind power industry and also provides additional income for wind farms as the requirements of RPS will increase with time. As existing states not only maintaining these requirements, but as states that have yet to adopt a mandatory RPS develop these guidelines, the wind industry expects to continue seeing significant growth.
