In states where there are no RPS requirements, voluntary programs sell renewable energy credits (RECs), also known as green tags. Through these programs, energy customers can choose to pay a little extra to offset their fossil-fuel grid electricity use with an equivalent amount of renewable electricity produced from a wind farm, PV array, or other renewable source (“renewable” is defined by a state regulatory authority and can sometimes include sources such as natural gas fuel cells and biomass burning, which aren’t actually “renewable”). However, trading demand for voluntary RECs is pretty low, thereby keeping the selling price low and doing little to provide much financial motivation for new RE installations. SRECs fetch much better prices than voluntary RECs because of the penalties incurred by a utility for not meeting an government-mandated RPS standard.
