The essentials
- In the U.S., when electricity is generated by a renewable energy source, two products are created: electricity and a Renewable Energy Credit (REC).
- In Arizona, a Renewable Energy Credit (REC) represents the non-power attributes of a kilowatt hour of electricity from renewable energy. These attributes include renewable benefits (such as hedging against fossil fuel price increases) and environmental benefits (such as avoided pollutants).
- The Arizona Corporation Commission requires regulated utilities to demonstrate their compliance with the Renewable Energy Standard and Tariff (REST) by obtaining RECs.
- RECs can be bundled or unbundled, and traded, bought or sold in markets such as the Western Renewable Energy Generation Information System (WREGIS).