Renewable Energy Certificates, Carbon Offsets, and Carbon Claims

Many consumers and businesses have questions about the role of renewable energy in reducing one’s carbon footprint. North American Renewable Energy Certificates (RECs) and carbon offsets are both environmental commodities that can be used to address greenhouse gas (GHG) emissions. This Q&A provides answers to questions about the difference between RECs and carbon offsets, how the markets for these commodities interact, and the extent to which each can be used to address GHG emissions. It examines REC definitions and renewable attributes, additionality as it relates to RECs, and ownership of reductions from renewable energy. It also answers questions about carbon offsets that are derived from U.S. renewable energy projects, including questions relating to additionality, the quantification of reductions, and double-counting.

This document is organized as a series of questions and answers. Readers that are beginners in renewable energy and carbon markets can read through from beginning to end, or more advanced readers can search and skip to answers to specific questions.