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Agencies buying energy credits to meet mandates

Jul. 22, 2012 - 03:28PM   |  
By ANDY MEDICI   |   Comments
Workers install solar panels on Los Angeles Air Force Base, Calif. Budget cuts are scuttling agency efforts to meet green government mandates, such as using more renewable energy and producing fewer greenhouse gas emissions.
Workers install solar panels on Los Angeles Air Force Base, Calif. Budget cuts are scuttling agency efforts to meet green government mandates, such as using more renewable energy and producing fewer greenhouse gas emissions. (Air Force)

Cash-strapped agencies are turning increasingly to renewable energy credits to meet energy mandates.

A renewable energy credit (REC) represents the environmental benefits of one megawatt hour of clean energy. Agencies purchase RECs to lay claim to those benefits and report the energy toward their renewable energy goals.

More than 77 percent of the renewable energy that agencies claimed to use last year was in the form of RECs, according to the Energy Department.

In fiscal 2011, agencies spent $2.5 million on 2.4 million megawatt hours of RECs — helping most agencies reach a goal to get 5 percent of their facility energy from renewable sources.

By 2013, agencies must get 7.5 percent of their facilities’ energy needs from renewable sources.

One megawatt hour is enough to power one home for a month. A renewable energy credit can cost around $1 per megawatt hour.

The Energy Department purchased 452,000 megawatt hours in 2011 — accounting for 8 percent of its electricity consumption.

Since 2009, the Energy Department has almost tripled its use of RECs, according to the agency.

The Agriculture Department increased its purchase of RECs almost tenfold, from 10,700 megawatt hours in 2009 to 104,000 megawatt hours in 2011.

The agency said decisions to purchase RECs are made annually and are budget-based.

Rachael Terada, project manager at the Center for Resource Solutions, said RECs are an affordable alternative to building renewable energy projects.

“We definitely see some agencies that are installing solar, but that isn’t always a possibility for every agency,” Terada said.

Rob Hardison, a consultant for LMI, a nonprofit that helps agencies reduce greenhouse gas emissions, said RECs are a significant part of agency strategies to meet renewable energy goals. They are especially useful to agencies that can’t build renewable energy projects.

“Some agencies just don’t have the capacity or the budget to put together those projects,” Hardison said.

But some agencies are trying to buck the trend and reduce their reliance on RECs.

The Interior Department said it plans to build more renewable energy projects and purchase fewer RECs.

For example, the National Park Service plans to install solar panels on top of its visitor station at Assateague Island, in Berlin, Md.

“We anticipate a reduced reliance on RECs to meet mandated renewable energy goals,” spokesman Drew Malcomb said.

The Defense Department intends to buy fewer RECs and instead invest money in on-site projects.

“It takes money to buy RECs, and you are not creating any new capacity. You are just spending money to meet a goal,” Dorothy Robyn, deputy undersecretary of Defense for installations and environment, said in an interview.

Robyn is confident DoD will get there without paying for credits. “We are in a position to generate renewable energy on our own installations,” she said.

Pentagon spokeswoman Melinda Morgan said the department does not track how much it spends on credits each year.

In 2011, DoD decided to scale back its purchase of RECs, despite having a goal to obtain 5 percent of its facilities’ energy needs from renewable energy sources. It achieved only 3.1 percent after reducing its purchase of credits from 440,000 to 248,000 megawatt hours, Robyn said.

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