The Biggest Myths About RECs Debunked

Renewable Energy Certificates (RECs) have been gaining attention for their role in sustainability. With this spotlight has come several myths and misconceptions, some far from the truth. So, what are the most common myths about RECs, and what’s the reality?

Myth 1: RECs Are Greenwashing

Reality: When properly sourced and certified, RECs play a legitimate role in supporting renewable energy projects. They are a valuable tool for businesses to demonstrate their commitment to sustainability. Verifying authenticity and certification is key to maintaining trust, encouraging investment, and advancing net-zero objectives.

Myth 2: There Is No Way to Verify RECs

Reality: Transparent, auditable tracking systems guarantee accountability throughout the REC lifecycle. Established mechanisms and standards validate authenticity, and third-party programs such as Green-e certification set benchmarks for environmental and consumer protection in North America.

In regions with Renewable Portfolio Standards (RPS) or similar regulations, government oversight ensures compliance in issuance, tracking, and trading. Essential documentation — including generation details, ownership records, and retirement data — reinforces integrity and instills buyer confidence.

Myth 3: RECs Do Not Provide Additionality

Reality: RECs incentivize investment in renewable electricity that might not otherwise be possible. While the purchaser does not receive the physical electricity, the financial support drives the growth of existing projects and the development of new ones.

Purchasing RECs also signals demand to the market, encouraging developers to expand capacity and influencing policy changes that support renewable infrastructure.

Myth 4: RECs Replace On-Site Renewable Generation

Reality: RECs can complement, but not replace, on-site renewable projects. Many organizations adopt a dual strategy: combining on-site generation with REC purchases to meet renewable targets.

This diversified approach helps mitigate service disruption while supporting additional renewable generation beyond a company’s facilities.

Myth 5: All RECs Are the Same

Reality: RECs differ by technology (wind, solar, hydro), vintage (year of generation), and certification standards. Companies should review these characteristics to ensure alignment with sustainability goals.

RECs are a type of Energy Attribute Certificate (EAC) specific to North America. In other regions, they are known as Guarantees of Origin (GOs) in Europe, Certificados de Energías Limpias (CELs) in Mexico, or Large-Scale Generation Certificates (LGCs) in Australia. Regardless of the name, all typically represent one megawatt hour (MWh) of renewable electricity.

Myth 6: RECs Are Expensive and Only for Large Corporations

Reality: REC prices vary, and options exist for businesses of all sizes. Programs and initiatives make it possible for smaller companies and even individuals to participate.

Solutions such as HedgeZero enable organizations to optimize procurement, manage costs, and time the market with expert guidance.

Myth 7: RECs Are the Same as Carbon Credits

Reality: RECs and carbon credits are distinct mechanisms. RECs certify renewable electricity generation and ensure that a certain amount of electricity is produced sustainably. Carbon credits, by contrast, compensate for emissions through projects that capture, avoid, or remove carbon elsewhere.

These tools complement one another. After measuring their footprint, companies typically reduce emissions with RECs or renewable natural gas (RNG) and then apply carbon credits for unavoidable emissions. A comprehensive procurement strategy ensures robust corporate emissions reduction.

Why Debunking REC Myths Matters

Addressing misconceptions is essential to understanding how RECs promote renewable electricity adoption and support sustainable practices. To contribute effectively to the energy transition, businesses, policymakers, and consumers must understand the nuances of RECs.

Start your climate conversation with one of our experts to see if RECs are the right fit for your renewable energy mix.

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