RECs explained: who owns the green claim on your solar

What exactly is a renewable energy certificate?

When a solar array, wind turbine or other renewable generator produces electricity, two things are created. One is the electricity itself, which flows into the grid and is billed. The other is the environmental attribute, the fact that the power was renewable. A REC packages that attribute as a separate item. The usual unit is one certificate per megawatt-hour, which is 1,000 kWh.

The certificate can be sold apart from the electricity. A company that buys RECs can say it supports renewable generation, even if the power it physically uses comes from the regular grid. Rules, registries and names for these certificates differ between countries and between provinces. Our broader guide to renewable energy certificates and tokens covers the market and the newer token ideas.

How much is a home solar system worth in certificates?

Not much on its own. As an assumed example, a rooftop system that produces 6,000 kWh in a year creates six megawatt-hours of attributes, so six certificates if every unit were registered. Certificate prices vary by market and year, and administration, metering and registry fees can use up a large share of the proceeds from so few units, which is why many small systems are never registered.

Larger projects and aggregated groups of small systems are where certificate sales make more sense. Treat any offer that promises a large income for registering a home system with doubt, and read the contract before signing. A guide to spotting bad offers is in solar crypto coins and how to spot scams.

What is the difference between a REC and net metering?

Net metering is a billing arrangement. Power you export to the grid earns a credit on your bill, under rules set by the province and utility, as described in Alberta net metering explained for one example. It says nothing by itself about who owns the green attribute.

A REC deals with that attribute. In some programs, signing up to export or to receive an incentive hands the attributes to the utility or program operator, and in others the owner keeps them. The terms are in the agreement, so read the clause on environmental attributes, emissions credits or renewable claims. If you have a lease or a power purchase agreement, the third party may hold them, a topic touched on in solar lease versus PPA.

Why does ownership matter for your claims?

If you sell the certificates for your solar output, you cannot also tell people that your home runs on solar power, because the green attribute now belongs to the buyer. Counting it twice is called double counting, and standards for certificates exist mainly to prevent it. If you keep the certificates, you can describe the generation as yours.

That matters for anyone reporting on emissions at home or at a small business. The heating side of your footprint is explained in greenhouse gas from home heating. Savings also have to be kept apart from incentives and tax: the records to keep are in the solar paperwork and tax checklist.

What does this have to do with Drake Landing?

Not much directly, since Drake Landing Solar Community in Okotoks, Alberta, produced heat, not electricity, and heat is outside the usual REC system. Its solar heat served the homes directly through a district loop, so there was no certificate to sell, as the district heating page describes. The example is useful as a contrast: the benefit of solar heat shows up in lower gas use and emissions, not in a tradable record.

Before taking part in any certificate program, ask the utility or your provincial energy ministry how renewable attributes are treated, and check the Government of Canada energy pages for current rules. Request the terms in writing.

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