Why Clean Energy?
Clean energy is heat or electricity generated from a renewable resource, such as wind, sunlight, geothermal, or sustainable biomass (renewable organic matter) that generates little or no pollution or emissions. In contrast, fossil fuels like coal, oil, and natural gas are not considered clean because of the pollution associated with their extraction from the earth and the pollution created when they are combusted. The gases emitted when fossil fuels are burned include air pollutants and greenhouse gases.
Much of the electricity supplied to American homes today is generated by burning fossil fuels. As a result, the average American home that uses standard electricity generates more greenhouse gases and pollution in a year than an average car generates during the same period!
Switching from electricity to a clean energy source helps to:
Purchasing Clean Electricity
The energy market in Maryland is deregulated, so you can choose your electricity supplier and the source of the electricity you want to buy. As a result, you do not need to install special equipment to receive clean energy. Through a competitive electricity supplier, you can choose to buy a percentage (or all) of your electricity from clean energy sources like wind or solar. This "clean" electricity is delivered to your house by your local utility, in the same way it provides fossil fuel generated electricity.
Note: You can switch electricity suppliers at any time. However, if you already have a contract with an electricity supplier, be sure to check it before you switch products or suppliers! To avoid penalties, you might have to wait your current contract expires.
The diagram below shows how electricity moves from generators to your home. Electricity generated from nuclear, coal, wind, and other sources is transferred to the energy grid. Your local utility company (BG&E, Pepco, or Allegheny Power) or your clean electricity supplier purchases power from the electricity generators. This electricity is transmitted through the grid to your area and the utility company distributes it to your home.
Though some of the electricity available in the grid was generated using a renewable resource, this clean energy can't be distinguished from the millions of other electrons flowing through the wires to reach your home or business. The grid is like a big pool being filled with water from many hoses. The hoses provide electricity from different energy sources—coal, nuclear, wind, solar, etc. Once the water is in the pool, you can't tell which hose it came from; once the electricity is in the grid, you can't identify its source.
Energy suppliers can influence how much electricity is transferred to the grid from each source by selectively purchasing electricity from different generators. If, for example, an energy supplier purchases more energy from a generator that produces electricity from a renewable source, such as wind, more of the electricity available in the energy grid will come from a clean energy source (as shown in the figure below).
By purchasing clean electricity through a competitive energy supplier, you're creating a market for renewable energy and pushing energy suppliers to purchase more electricity from clean energy generators. You're directly affecting the amount of clean electricity available in the grid and supporting energy generators that produce sustainable, renewable electricity!
Choosing an Electricity Supplier
Your utility (Pepco, Potomac Edison, or BG&E) is the entity that you are probably most familiar with. It transmits electricity to your home or business and sends you the bill. The utility, however, distributes electricity that is provided by electricity suppliers - separate entities that purchase energy from electricity generators.
In Maryland, it is possible to choose your electricity supplier. Once you choose a different electricity supplier, you will still be billed by the utility, but your bill will include the cost of generating the electricity provided by your electricity supplier.
What is My Current Energy Supplier?
Suppliers providing electricity to Maryland consumers must be licensed by the MD Public Service Commission (PSC) and comply with PSC rules on marketing, solicitation, contracting, and all Maryland consumer protection laws. Electricity suppliers may offer different contract or price terms than your local utility, or may offer a contract that helps to promote renewable energy, such as wind energy.
Consumers that do not choose their electricity supplier are provided "Standard Offer Service" (SOS) through their local utility. The cost that consumers pay for this generated electricity can be found on their electric bill, or by referring to appropriate link below corresponding to your electric utility.
Links to Utility Electricity Rates
The price of the electricity offered by a competitive electricity supplier can be found by visiting the website or calling a supplier approved by the PSC. Contact information for these suppliers can be found on the PSC website. However, the listing provided by the PSC does not provide a clear indication of which suppliers provide electricity from clean sources like wind or solar.
An alternative listing provided by the Maryland Office of People's Counsel (OPC) provides some information on the source of the electricity each of the suppliers is offering. Because the cost of electricity from a supplier can vary, it is recommended that you contact a supplier that you may be interested in directly for up-to-date pricing information
Additional information on selecting a competitive electricity supplier can be found on the OPC website.
Renewable Energy Certificates
Renewable energy certificates (RECs) quantify the amount of clean energy a generator has produced from a clean, renewable source (such as wind or solar) and transmitted to the power grid. The generator accounts for the clean energy transmitted by assigning a unique "certificate," or number, to each megawatt-hour (1,000 kilowatt-hours) of electricity generated. The generator uses the certificates to account for how much clean energy was produced and how much clean electricity utilities and consumers can buy.
RECs also represent the environmental benefits of clean energy generation. The environmental benefits are the emissions avoided because electricity was produced from a clean energy source instead of from a standard fuel source such as coal, oil, or gas. For instance, RECs represent the pounds of carbon dioxide, sulfur dioxide, and nitrogen oxides that were not emitted due to the burning of fossil fuels. RECs are essentially carbon offsets that are sold to offset the pollution from electricity generated by burning fossil fuels.
RECs can be sold by the clean energy generator in one of two ways:
The diagram below shows how RECs from clean energy generators can be sold to energy suppliers or REC Marketers and then to the consumer (you). When you buy clean energy from an energy supplier, the supplier passes the REC on to you with electricity service. When you buy a REC through a REC Marketer, you're just purchasing the environmental benefit of the clean energy without electricity service. This flexibility allows even those who do not directly communicate with their energy suppliers or negotiate their lease conditions (such as businesses, congregations, condominium owners, or renters) to offset the pollution from the fossil-fuel-sourced electricity they buy and use.
Remember: If you are purchasing RECs along with energy from a utility, it is important to realize that you are not getting the exact electricity that was generated from the clean energy source. The energy you receive is pulled from the energy grid, which stores energy from many sources across the country. The REC provides a representation of the clean energy you helped bring to the grid and the environmental benefit of that clean energy generation.
Why Buy RECs?
About 38 percent of the greenhouse gases produced in the United States come from electricity generation (See EPAs 2009 Inventory of Greenhouse Gas Emissions and Sinks for more information). Purchasing RECs adds more clean energy to the power grid and helps decrease the amount of electricity generated from fossil fuels.
In addition, money generated from the sale of RECs can help fund clean energy projects. Electricity generated from renewable sources can be inexpensive to produce, but getting started is challenging and expensive. There are government subsidies and tax breaks that support renewable energy generation projects, but these subsidies are much less than those available to those using fossil fuels and other energy sources. The sale of RECs gives clean energy generators more flexibility in covering the costs of clean energy projects.
Purchasing RECs also helps balance the supply and demand for clean energy. There is not always a demand for clean energy where it is produced, and some energy suppliers do not offer clean energy options. However, there might be a demand to support clean energy elsewhere. By separating the environmental benefits of clean energy generation from the actual electricity, the generator can get a fair market price for its electricity and help consumers elsewhere offset the emissions associated with their electricity use.
These are several great reasons to purchase RECs. But here's the icing on the cake: Buying RECs is an easy way to reduce your environmental footprint without a large financial commitment. It's just not always possible to buy a new, fuel-efficient car or undertake a home improvement project, but it's easy to make a purchase supporting cleaner energy generation.
How Do I Buy RECs?
You can purchase RECs from a REC marketer. Depending on the REC Marketer, RECs can be a one-time purchase or can be purchased in monthly installments. Each REC Marketer offers a variety of product options. Several businesses sell RECs online. Some companies send a certificate verifying your REC purchase; others send a letter.
Shop around and find the type of REC (wind, solar, a blend of clean energy generation sources) and the Marketer that is in line with your goals for purchasing clean energy. For instance, is there a specific type of clean energy you want to support? Do you want to support clean energy that is generated in your region or somewhere else in the country?
How Much Do RECs Cost?
It depends. The per-unit price of a REC depends on the type of clean energy generated (wind, solar, sustainable biomass), where the clean energy was generated, and how many RECs you want to purchase. For instance, wind RECs from the Midwest or Texas, where there is an abundant supply of wind energy, may cost 1.5 cents per kilowatt-hour and may be less expensive than solar RECs from the Mid-Atlantic where the solar industry is just starting to gain a foothold. REC Marketers sell renewable energy certificates from all types of clean energy generators so you can choose the type of clean energy you want to support as well as the location.
How Many RECs Should I Buy?
When you purchase RECs, you can buy RECs equivalent to any amount of your total electricity use. Buying RECs in an amount equal to your electricity use allows you to offset all of the emissions, or you could choose to offset a portion of your electricity use. Regardless of how many you decide to purchase, as a REC consumer, you are supporting the addition of clean electricity—and its environmental benefits—to the power grid.
You can estimate the number of RECs to purchase in one of three ways:
Who Benefits from the Purchase of RECs?
We all do! Your choice to switch to clean energy helps decrease our impact on the environment. The United States has only 5 percent of the world's population, but we produce 25 percent of its greenhouse gases. Clean energy, combined with energy-efficient technologies, is one of the several solutions to help decrease the amount of pollution we release into our environment and protect our planet for future generations.