The RECs system was originally implemented to encourage an additional 9,500 Gwh of renewable energy generation per year by 2010 as part of the Renewable Energy Target. Renewable Energy Certificates will play an even greater role in the recently announced renewable energy targets to be achieved by 2020 via the Solar Credits Program.
How the new Renewable Energy Target works
The government has implemented a target of 20% renewable energy sourced electricity by 2020
The current RET requires 9500 GWh of renewable energy to be delivered by energy companies
The 20/20 target requires 45000 GWh
1MWh of energy equals 1 REC, so 45,000,000 RECs will be generated to meet the 2020 target
To meet the target, energy companies must surrender RECs into their holding account at the end of every calendar year at an amount representative to 20% of their market share
If energy companies don't put sufficient RECs into the holding account, the company is fined at a rate much higher than the REC value.
RECs - renewable energy currency
One REC is equivalent to one megawatt hour of electricity generation. A renewable energy certificate can be traded for cash and the value of these certificates fluctuates according to market conditions. Basically, a REC is a form of renewable energy currency and through Energy Matters; you can sell your RECs to us and use the money as a point of sale discount on items you buy!
Owners of systems can claim RECs themselves by completing the appropriate application forms. However, this can be confusing and time consuming, so most people choose assigning their right to claim RECs to an agent, such as Energy Matters; which is a very simple process.
By taking advantage of Renewable Energy Certificates, a substantial amount of money can be saved when you buy wind and solar power equipment!