When IMEA sells the vast majority of the Renewable Energy Certificates (RECs)[i] for the generation of its renewable energy resources in its power supply portfolio, IMEA also surrenders the legal right to claim that specific renewable energy[ii]. Therefore, we believe it is appropriate to state that it is a myth that IMEA’s power supply resources provide IMEA Members with renewable energy.
This myth arises in the absence of prominent mention by IMEA of using REC arbitrage[iii] to sell most of the higher priced RECs associated with IMEA’s power supply resources and to buy lower cost RECs of which many involve out-of-state resources and older dates. There is no mention in IMEA’s webpages describing IMEA Renewable Generation nor in IMEA annual reports. IMEA is largely silent on the source of its renewable energy claims, except during December IMEA board meetings beginning in 2020,
And we believe that it’s another example of IMEA not telling the more complete story, especially when IMEA continues to make claims of IMEA renewable energy progress being much greater than the progress of the State of Illinois and others. As advocates for transparency, we believe that IMEA should clearly and prominently explain the source of the IMEA renewable energy claims[iv].
Below is a summary of IMEA REC retirements[v] since the IMEA REC Program was first established. The program was approved as part of IMEA board resolution #20-06-851 adopted on June 18, 2020.
For IMEA REC Planning Year 2024 (June 1, 2023 through May 31, 2024):
- 342,348 RECs were retired
- 97.9% of the RECs (334,990) were arbitraged RECs
- Only 2.1% of the RECs (7,358) were from IMEA power supply resources
https://drive.google.com/drive/folders/1smtUp88MTQXNh87KLh6YYmt0Ka911vCm
For IMEA REC Planning Year 2023 (June 1, 2022 through May 31, 2023):
- 376,508 RECs were retired
- 98.8% of the RECs (371,885) were arbitraged RECs
- Only 1.2% of the RECs (4,623) were from IMEA power supply resources
https://drive.google.com/drive/folders/1Wu_TV-1Hh65RlLyyHt_Njht0rbex599a
For IMEA REC Planning Year 2022 (June 1, 2021 through May 31, 2022):
- 386,575 RECs were retired
- 99.9% of the RECs (386,524) were arbitraged RECs
- Less than 0.1% of the RECs (51) were from IMEA power supply resources
https://drive.google.com/drive/folders/1DMx_OZjSWAct9gcF1XXUhKabxJHW4bC9
For IMEA REC Planning Year 2021 (June 1, 2020 through May 31, 2021):
- 366,694 RECs were retired
- 97.5% of the RECs (357,406) were arbitraged RECs
- Only 2.5% of the RECs (9,288) were from IMEA resources
https://drive.google.com/drive/folders/1Aayqds9_Inv3pLKtm2qttVeIIiZL7-J4
And for the years prior to adoption of that IMEA board resolution #20-06-851:
- IMEA apparently did not retire any RECs to be able to make claims of providing renewable energy
[i] “Renewable Energy Certificates (typically referred to as “RECs,” and also known as “green tags” and “tradable renewable certificates”) are at the heart of sales of renewable electricity. A REC represents the environmental attributes, but not the electrons, of 1 MWh of renewable energy generation on the electricity grid. They are used to track when and where renewable energy is generated, who it is sold to, and who is using it. When electricity is generated, the electrons are all mixed together on the grid, and there is no way to know the sources from which they were generated. RECs make it possible for consumers and businesses to choose clean energy and not have it be claimed by anyone else.
When RECs are sold, they can be either bundled or unbundled from their associated electricity. Bundled RECs include their underlying electricity, while unbundled RECs do not. A MWh of electricity with the REC stripped off is known as “null electricity” or “null power”.”
https://resource-solutions.org/learn/recs/
[ii] “RECs are the accepted legal instrument through which renewable energy generation and use claims are substantiated in the U.S. renewable electricity market.”
https://www.epa.gov/green-power-markets/renewable-energy-certificates-recs
Further details are available at:
Center for Resource Solutions
The Legal Basis for Renewable Energy Certificates
https://resource-solutions.org/wp-content/uploads/2015/07/The-Legal-Basis-for-RECs.pdf
[iii] “Arbitrage is the near-simultaneous buying and selling of commodities in different markets in order to take advantage of differing prices for the same or similar assets. REC arbitrage occurs when RECs from one renewable electricity project are sold and replaced by less expensive RECs from another renewable electricity project.”
https://www.epa.gov/sites/default/files/2017-09/documents/gpp-rec-arbitrage.pdf
[iv] “Research suggests that reasonable consumers may interpret renewable energy claims differently than marketers may intend. Unless marketers have substantiation for all their express and reasonably implied claims, they should clearly and prominently qualify their renewable energy claims. For instance, marketers may minimize the risk of deception by specifying the source of the renewable energy (e.g., wind or solar energy).”
Federal Trade Commission
Guides for the Use of Environmental Marketing Claims
16 CFR 260.15(b)
https://www.ecfr.gov/current/title-16/part-260#p-260.15(b)
PDF published at:
https://www.ftc.gov/sites/default/files/documents/federal_register_notices/guides-use-environmental-marketing-claims-green-guides/greenguidesfrn.pdf
[v] “Retiring a REC is the process of permanently removing it from the market and claiming its environmental attributes as a way of mitigating emissions from electricity usage. When a REC is retired, it is taken out of circulation and can no longer be traded or used by another party. This ensures that the environmental benefits represented by the REC are only counted once, preventing “double counting”. Retiring a REC signifies that the holder has claimed the environmental attributes of the REC and can count it against their carbon emissions.”
https://www.zettawatts.com/post/all-about-recs
Myths, misinfo, and lack of the complete story are often related to lack of transparency, so please consider visiting our Lack of Transparency webpage too.