Promoting Green Power in Canada - Centre for Human Settlements

Promoting Green Power in Canada Pollution Probemarginal extra amount, (b) sell the amountof green power purchased or self-generatedto selected customers at a premium as “greenpower,” or (c) sell the emissions reductioncredits linked to renewable power productioninto emissions credit markets. RPS designultimately decides this question: it couldsimply impose a renewable electricity quotaon the retailers’ overall portfolios, leaving itup to them which option they use to recovertheir extra expense to fulfill this requirement,but generally governments link the greenbenefits to RPS compliance, excluding theiruse for other purposes.Governments that have so far introduced anRPS found that because an RPS alreadyobliges retailers to buy a certain amount ofgreen power, customers should not be offeredthis same generation as green power,suggesting that they would want to buygreen power in addition to the legallyrequired amount. This leaves retailers onlyoption (a) to recover their cost, and greenpower marketing is seen as completelyseparate from the RPS system, and indeedintended to be additional to it. Theinstitution most advanced in developingsuch concepts is the Center for ResourceSolutions, which issues the American Greenelogo. The Center recommends theseparation of green power sales from RPScertificates, but concedes that the issue“warrants further study by stakeholders”[CRS 2001, p. 18]. The Texas UtilityCommission, which created the REC-basedTexas RPS, only accepts the full set ofenvironmental benefits for RPS definingRECs as a “tradable instrument thatrepresents all of the renewable attributesassociated with one MWh of productionfrom a certified renewable generator” [NWCC2001a, p. 50]. As these certificates are retiredtogether with all their environmentalbenefits at the time compliance is assured,none of the benefits can be sold into othermarkets (see Figure 5.9). Only surplus RECsthat are not needed to fulfill the quota couldbe sold as green power or disaggregated andsold into credit markets.The same principle is applied in the BritishNew Renewables Obligation. RenewableObligation Certificates (ROCs) can beconverted into carbon credits, but thencannot be used to fulfill the RenewablesObligation (see Figure 5.10). Once ROCs areretired as they are used to fulfill theObligation, they can no longer be used fortrading of environmental attributes. ROCsElectricityto gridRenewableEnergyCreditPowerRetailerRPSobligationElectricityto gridRenewableEnergyCreditPowerRetailerRPSobligationCredit MarketGreenPowerProducerNOxcreditCredit MarketGreenPowerProducerPowerConsumerScenario E: A green power producer maynot sell off single benefits of a green tagand still sell it as a renewable energycertificate to be used by a retailer to fulfillan RPS obligation.Scenario F: Renewable energy certificatesneed to be retired in quantities requiredunder the RPS each year. This means theycannot be traded in credit markets or soldas re-bundled green power.Figure 5.9 — Exclusion of Disaggregation of Green Attributes under the Texas RPS146