The Renewable Energy Certificate System (RECS) is a voluntary system for international trade in renewable energy certificates that was created by RECS International to stimulate international development of renewable energy. It advocates the use of a standard energy certificate to provide evidence of the production of a quantity of renewable energy, and provides a methodology which enables renewable energy trade, enabling the creation of a market for renewable energy and so promoting the development of new renewable energy capacity in Europe.
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A RECS energy certificate is issued for every 1 megawatt-hour (MWh) of renewable energy produced by an electricity generation facility that has been registered with the relevant national RECS issuing body. These certificates can be transferred between market parties in different countries, and are used to provide evidence of the consumption of renewable energy – at which point they are made non-transferable, in order to ensure that the "renewable benefit" is not double-sold.
While RECS guarantees the source of the energy and prevents double-counting, it is not a label: these also guarantee other matters relating to the supplied electricity, such as the originating technology, the age of the plant and the source of the energy. Labels must also ensure that sales of labelled electricity either do not change the blend of sources of electricity that is supplied unlabelled, or that the buyers of such electricity are informed accordingly.
The market for RECS certificates is administered by the Association of Issuing Bodies (AIB) according to its European Energy Certificate System (EECS), in the same way as the obligatory guarantees of origin required by the various European Union Directives that are gradually replacing voluntary RECS certificates in Europe.
Limits of RECS
Several non-governmental environmental organizations like Greenpeace and the World Wide Fund for Nature claim that in practice today there is no ecological benefit ensured by this certification method alone. Until the demand of this certification method does not exceed the supply by regenerative power plants, that has existed anyway for decades, it is criticized as being a pure mind-game: In practice the amount of regenerative power that is assigned to certificate buyers is just "assigned away" from the other power consumers; in total, nothing has changed. Indeed, some electricity traders misuse RECS that they bought from old regenerative power plants that existed anyways for years to imply misleadingly that buying their "RECS certified regenerative electricity" makes a change for the environment.
Safeguards Against Misuse
Reputable eco-friendly electricity labels (called "brands" in US English?) ensure an ecological benefit in practice. Some reputable labels (like the WWF co-funded German "ok-power" label) also use RECS, but only as a broadly-accepted accounting and tracking system (to register the power plants against double-selling); other labels require direct contracts for delivery with the plant as an alternative. The crux of such efforts is to additionally insist that the certificate-selling or directly-contracted power plant meets important eco-orientated standards; those standards typically encompass a maximum age of the power plant (to ensure that new power plants are built) and the banning of power plants that act against landscape or animal protection. Other labels co-issued by environmental organizations require that a part of the fee of every kWh is donated for investment in new eco-friendly power plants or technology.
In the United States, certified REC seller Arcadia Power buys certificates exclusively from projects located within the same ISO/RTO grid as the purchaser and which were produced within five years of sale. Primarily catering to residences and small businesses, the company provides customers with details about the wind or solar farm where their RECS certificates were generated.