By: Deborah Johnson Wood
Thanks to Michigan’s new renewable energy portfolio standard, Michigan nonprofits, businesses and residents who install clean energy devices could generate some unexpected income by selling renewable energy certificates (RECs).
In preparation for that possibility, a first-ever standardized process for calculating an REC could be in the hands of the International Standards Organization within weeks—submitted by Holland-based Viability Energy LLC.
An REC is a paper that, theoretically, documents the number of megawatt hours of electricity generated through renewable resources. Utility companies can purchase a limited number of RECs to help them meet the renewable energy mandates of the state's portfolio standard, a practice similar in form to cap-and-trade carbon models. Developers could purchase RECs for LEED certification points, or companies might buy them as part of a corporate sustainability initiative.
Certificates could sell for prices ranging from $1.50 to $30 per MWH.
“It’s easy to say a wind turbine generated one megawatt hour of power, and that can be measured and documented” says Steve Hamstra, vice president of GMB Architects-Engineers. GMB, Viability LLC and GDK Construction formed Viability Energy earlier this year.
“But geothermal heat pumps have also been defined as renewable energy systems by the Federal Government,” he notes. “How shall we measure their performance? Because there’s no industry standard, the problem is how much energy did you really generate?”
And that sets up the potential for error and fraud.
Viability Energy’s proposal uses the internationally recognized ASHRAE Standard 90.1 that compares energy use in buildings using a computer model. Similarly, computer models could compare the energy use of a building powered by renewable energy to one powered by non-renewable energy. The difference in carbon emissions between the buildings can then be converted to RECs.
“The RPS has created a significant market in Michigan for RECs,” Hamstra says. “Because it’s a very new thing in Michigan, it will be interesting to see how it all comes together.”
Source: Steve Hamstra, GMB Architects-Engineers
Related Articles
Holland firm launches alternative energy design, engineering endeavor, adds jobs
Deborah Johnson Wood is development news editor for Rapid Growth Media. She can be contacted at [email protected].
Enjoy this story?
Sign up for free solutions-based reporting in your inbox each week.