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Green Certificate |
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Green certificate is also known as Renewable Energy Certificates (RECs), green tags or tradable renewable certificates. It is a tradable commodity which proves that a certain amount of electricity is produced using renewable energy sources. Usually 1 Megawatt hour of electricity represents one certificate. The term ‘renewable’ differ from various certificate trading schemes.
Renewable Energy Certificates gives incentives for carbon-neutral renewable energy by offering subsidy to electricity from renewable sources. By increasing the emitting carbon costs, traditional carbon emissions trading programs encourages low-carbon technologies. In some US states with REC program, one REC is credited to the green energy provider for every 1 MWh or 1,000 kWh of produced electricity. Each Renewable Energy Certificates is given a unique identification number by a certifying agency to avoid double-counting. This green energy is supplied into the electrical grid and its REC is sold on the open market.
Some of the sources which are considered as renewable are-
1. Biomass (further classified by actual fuel used)
2. Geothermal
3. Wave (further classified into offshore and onshore)
4. Hydro (further classified into large and small)
5. Wind (further classified into offshore and onshore)
6. Solar (further classified into thermal and photovoltaic)
7. Tidal (further classified into onshore and offshore)
The environmental value of renewable energy generated is represented by Green certificates. These can be separately traded from the energy production. To support green electricity generation and bring it close to market economy, green certificates are used by many countries. National trading schemes are used in the UK, Belgium (Wallonia and Flanders), Poland, Sweden and in some US states.
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