Renewable Energy Certificates

(RECs), also known as Green tags, Renewable Energy Credits, or Tradable Renewable Certificates (TRCs), are
tradable environmental commodities in the United States which represent proof that 1 megawatt-hour (MWh)
of electricity was renewable (generated from a eligible renewable energy resource).

These certificates can be sold and traded and the owner of the REC can claim to have purchased renewable
energy. While traditional carbon emissions trading programs promote low-carbon technologies by increasing
the cost of emitting carbon, RECs can promote carbon-neutral renewable energy by providing a production
subsidy to electricity generated from renewable sources. It is important to understand that the energy
associated with a REC is sold separately and is used by another party. The consumer of a REC receives only a
certificate.
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