Renewable Energy Certificates(RECs), also known as “green tags,” are proof that 1 megawatt (MW) of renewable energy was generated and delivered to the regional power pool, and they represent the environmental attributes of the power produced from renewable energy projects. RECs are sold separately from the electricity commodity.
For every unit of renewable energy generated and delivered to the regional power pool, an equivalent amount of RECs are created representing a tracking mechanism to insure that no two customers pay for the same unit of renewable energy generation. When you sign up for Pure Power, Ameren Missouri contracts for RECs to match the equivalent of your ongoing electrical needs or the number of Pure Power "Blocks" you elect to purchase. Thus, the more RECs that are sold, the more demand is created for renewable power. As renewable facilities sell out their RECs, demand shifts to bring more renewable energy sources online.
New renewable energy sources are being constructed across the United States to meet the demand created for renewable energy. Your purchase of RECs benefits the environment by encouraging greater renewable energy generation and displacing non-renewable generation from the electricity system.
RECs are traded daily but the pricing depends on many different variables, including traditional issues of supply and demand, what types of renewable resources apply to individual state compliance requirements, whether the purchase is made under a long-term contract versus on the spot market and the overall geographic origination of the facility. Even within the same geographical area and set technologies you can see a whole range of pricing during a short period of time. For example, Texas, a state with an abundant wind resource, has seen REC pricing below $1 and above $8 for the same product during different periods. On the high end, the Massachusetts market regularly trades in the $60 range. Pure Power focuses our REC sourcing om local facilities. Prices in this region have historically ranged anywhere from $1 to $20 for a Wind REC.
All of the RECs supported through Pure Power customers since 2010 have come from Missouri wind farms. Support of Missouri renewable energy will continue to be a priority and additional projects will likely be incorporated as the program grows.