Quality certification of products with Tradable Renewable Electricity Certificates (TRECs)
Tradable
environmental certificates can be a powerful tool to create market-based
incentives for "green" technologies. In the case of electricity from
renewable energy sources, each certificate represents the benefits of a certain
volume (e.g. 1.000 kWh) of renewable power over conventional or nuclear
electricity generation. This benefit is separated from the commodity electricity
at the point of power generation ("issuing of TRECs"). Thus the
generator sells two separate products: electricity and TRECs. The certificates
can be transferred to any other party without being constrained by the
electricity system. Transfers of TRECs can even take place between different
continents, e.g. North America and Europe.
TRECs
usually exist as electronic records in a database. This is similar to the way
banks are keeping accounts for the money of their customers. The value of a
certificate is "cashed in" when it is consumed. This means that it is
removed from the market, e.g. by deleting the record in the database or moving
it to a redemption account. Until a TREC is consumed, it can easily be traded
between parties just like any other good. Any body who has bought and consumed
TRECs can claim that he has promoted the corresponding volume of electricity
from renewable energy sources through the instrument of TRECs.
Are there already
TRECs systems in operation?
Yes. In
Europe, several countries (e.g. United Kingdom, Italy, Denmark, The Netherlands,
Austria) have introduced TRECs systems, usually along with an obligation for
electricity suppliers or consumers to buy and consume a certain amount of TRECs.
As these systems are not fully compatible with each other, the Renewable Energy
Certificate System (RECS) initiative has developed a harmonized European TRECs
system, which is currently operating in a test phase (http://www.recs.org/).
In other parts of the world, like several U.S. states, Canada, Australia and
Japan, similar systems exist.
TRECs
can be used to promote renewable electricity, either through obligations imposed
by governments or by voluntary demand. By buying and consuming TRECs products,
each individual as well as companies or any other body can contribute to the
deployment of renewable energy.
Why does Öko-Institut
provide quality certification for TRECs products?
Öko-Institut
has been involved in labeling of Green Power since 1999. Together with the World
Wide Fund for Nature (WWF) Germany and the Verbraucherzentrale (a large consumer
NGO), the institute has set up the association EnergieVision e.V. (http://www.energie-vision.de),
which issues the "ok-power" label for Green Power in Germany. Besides
ecological criteria for the eligibility of renewable sources, the label focuses
on ensuring environmental additionality of Green Power through the expansion of
renewable generation. Öko-Institut also contributes to the establishment of a
harmonized Green Power label in Europe through the European Green Electricity
Network (EUGENE).
With the
establishment of a quality standard for TRECs products Öko-Institut wants to
provide a service to these products like it already does for Green Power.
The TRECs quality certification guarantees that
ˇ
the TRECs product supplier consumes the
appropriate number of certificates to cover the demand of his customers
ˇ
certified products really contain the full
benefits of renewable power and no double selling of electricity and/or
certificates takes place
ˇ
only environmentally sound renewable energy
sources are used
ˇ
certified products contain at least 33 %
TRECs from new plants and therefore contribute significantly to the expansion of
renewable power generation
Details
of the criteria for Öko-Institut's quality certification for TRECs products can
be found in the criteria
paper (Release 1, PDF,176 kB).
What is the status
of
the certification scheme?
The
quality certification is established in a pilot phase starting in January 2002.
During the year 2002 first experience with certification of TRECs products will
be made and following this the criteria and procedures of the certification
scheme will be refined. The pilot phase itself is open to any supplier of TRECs
products willing to subscribe to the requirements of this certification scheme.
Any comments to the criteria and procedures are welcome.
The
certification procedure is open for other parties like labeling organizations,
environmental and consumer NGOs who wish to join Öko-Institut in its effort to
define quality standards for TRECs products. It is the aim of Öko-Institut to
link the TRECs label to the harmonized Green Power label of the European Green
Electricity Network (EUGENE).
How can I receive
certification for my TRECs product?
If you
are a supplier of a TRECs product and you are interested in a certification of
your product, please contact Öko-Institut (for contact details see below).
ˇ
World
Wide Green
Order a TRECs product online at the WWG website http://www.worldwidegreen.com/.
This
list will be updated as soon as other products are certified.
For more
information please contact us via email, mail, telephone or fax:
Mr.
Christof Timpe (timpe@oeko.de)
Öko-Institut
PO Box 6226
D-79038
Freiburg
Germany
Fax
+49-761-47 54 37
Center
for Resource Solutions (USA): Green-e certification of T-REC based products
EnergieVision
e.V.: Green Power labeling organization in Germany ("ok-power"
label, website currently only in German).
Greenprices:
Website on green energy in Europe
Energy
Research Centre of the Netherlands (ECN): Site with research reports on
TRECs
Renewable
Energy Certificate System (RECS): A harmonized TRECs system for Europe
APX
power market: Green power market using TRECs
The
Green Electricity Market (Australia): TRECs market in Australia
International
Energy Agency (IEA): Results of an IEA workshop on TRECs in February 2001