I-RECs

What are I-RECs?

International Renewable Energy Certificates (IRECs) are digital certificates that represent the environmental benefits of one megawatt-hour (MWh) of electricity generated from a renewable energy source, such as solar, wind, or hydro. Think of them as a way to track and trade the “greenness” of electricity separately from the physical electricity itself. One IREC essentially signifies that a certain amount of clean energy was produced.

Who Generates IRECs?

Developers and owners of renewable energy power generating plants, including those utilizing solar, wind, hydro, or biomass, are eligible to generate IREs. This applies regardless of the project type, whether it’s a utility-scale installation, a capital expenditure (CAPEX) project, or a third-party selling arrangement. It’s important to note that the specific eligibility criteria for IREC generation can vary depending on the state or region where the project is located.

How Renewable Energy Companies can Generate and Trade IRECs?

– Generation: When a renewable energy facility generates electricity and feeds it into the grid, it can apply to an accredited IREC registry (like the I-REC Standard) to issue IREs for the amount of renewable energy produced (typically one IREC per MWh).

The registry verifies the source and amount of renewable energy.

– Certification and Registration: The renewable energy generator provides documentation about their facility, the technology used, and the amount of electricity generated to the registry. Once approved, the registry issues IRECs into the generator’s account within the registry system. These IREGs have unique identification numbers and specify details like the energy source, location, and generation date (vintage).

What are the benefits for the generator?

Additional Revenue Stream: Selling IRECs provides a separate revenue stream in addition to selling the physical electricity generated. This can improve the financial viability and profitability of renewable energy projects.

Improved Project Economics: The income from IREC sales can help to offset the capital and operational costs of renewable energy projects, making them more competitive with traditional fossil fuel-based power generation.

Attracting Investment: Projects that can generate and sell IRECs are more attractive to investors who are increasingly focused on sustainable and environmentally responsible investments.