White Tags, Green Tags, etc. for Renewable Portfolio Standard (RPS) Programs
White Tags for Energy Efficiency AchievementsGreen Tags and White Tags can be used to favorably impact the economics of renewable energy generation and energy conservation projects by monetizing reduced carbon emissions. The Green Tag market is expected to grow from about $250 million to nearly $1 billion dollars per year by 2010.
According to the Western Area Power Administration (DOE), the new White Tag market is emerging as a potentially far larger market. Presently, these markets are characterized by fragmented brokerage-driven transactions. The growth and increasing liquidity of these markets is creating valuable opportunities for trade-driven transactions that capitalize more efficiently on changing market conditions.
White tags are to energy efficiency as a renewable energy credit (REC) is to renewable energy—a means to quantify an amount of energy saved from investment in either equipment or process changed. Two states have already included White Tags into their Renewable Portfolio Standard (RPS) programs due to the real environmental benefit that energy efficiency brings to the energy mix.
Payback for Development and Expansion of Energy Efficiency ProgramsQuantifying and packaging the savings involved in an energy efficiency program, facilitates the monetization process needed to help pay for the development and expansion of energy efficiency programs. This has proven to be very successful and necessary component in the development of renewable energy programs, so many feel that this type of product will similarly help the development of the energy efficiency market.
The most universal Measurement and Validation (M&V) method of calculating energy savings is by modeling. These calculations require the establishment of a baseline energy use
Renewable Energy Certificates (REC) or Green Tag
RECs or Green Tags (1 MWh = 1 Tag)REC Purchases Mandated by State Renewable Portfolio Standards (RPS) Retail Electricity Suppliers Must Meet a Percentage of Sales in RECs Suppliers Assessed Compliance Prices for Failing to Meet Percentages
RECs represent the contractual right to claim the environmental and other attributesassociated with electricity generated from renewable energy. Companies apply these to their Greenhouse Gas (GHG) emissions.
Some of the highest state REC requirements include:
This translates into a market size that is growing. The Compliance Market for RECs by 2010 are estimated to be 45 (Million MWhs) worth $600 million; and the Voluntary Market is 20 (million MWHs)...wo rth $100-$300 million). Source: NREL Energy Analysis Office.
Energy Efficiency Certificates (EEC) or White Tag™In 2006, Sterling Planet introduced White Tags™ energy efficiency certificates, each representing one megawatt hour of energy savings.
White Tags represent the value of energy "NOT USED/Conserved" at facilities. White Tag credits are created through implementation of conservation projects on the demand-side and CHP. They are principally electricity, but can be any energy supply.
Today, three states have portfolio standards for conservation:
White Tag Certificates have both compliance and voluntary markets, and are similar in many ways, but the voluntary market is estimated to be larger than RECs. Certification is similar, but more complex because it represents savings -- not generation.
White Tag Certificates are FACILITY based, not equipment based, and they require Measurement and Vertification (M&V) that requires historical challenges.
The owner of the facility, not the equipment, has title to the tags, so leased facilities are problematic. If a utility funds the project with rebates, the utility owns the tags.
The tags have a one year expiration, and certification requires the approval of a M&V plan.
The key issue for White Tags is their certification through an accurate and acceptable Measurement & Verification (M&V) process. Unlike Green Tags, which can be measured directly from metering of the renewable energy production, white tags must be determined through calculations of energy reduction from conservation projects.
White Tags Regulation
Carbon CreditsThe Carbon Credits market is evolving, complex, state-based with many stakeholders & protocols. This program includes Renewable energy (excluding geothermal, landfill gas and direct biomass).
Tags are viewed as Indirect; Carbon Credits are viewed as Direct Reductions
Indirect reductions to Environmental impact (CO2, SF6, CH4, N20, HFCs, PFCs) come from:
Combined Heat and Power (CHP)Combined Heat and Power or cogeneration that meet all permitting requirements for operation are eligible for White Tags™. There are several unique issues with CHP.
White Tag Creation OversightThe Department of Power and Utility Commission (DPUC) oversees the creation of White Tags™ through the Conservation & Load Management Administration (funds utility projects).
Economics of Renewable Energy23 states have mandatory carbon commitments (green) and 10 states are considering them (2008). The voluntary market includes businesses, universities and cities who have signed Volunary commitments. The Western Governor's Climate Initiative (Washington, Oregon, Idaho, Montana, Colorado, Wyoming, Nevada, California, New Mexico, Arizona, ) has made 2011 the first compliance year. Other regional Pacts include the Midwestern Climate Pack and the Regional Greenhouse Gas Initiative (RGGI).
Top Renewable Energy Purchasers include: Itel, PepsiCo, USAF, Wells Fargo, Whole Foods, Pepsi, Johnson & Johnson, Cisco Systems, Dallas, HSBC NA, US EPA, City of Houston, Kohl's Department Store, LA County Sanitation District, Starbucks, DuPont, US DOE, Pennsylvania, Pepsi, Vail Resourts, New York University, NatureWorks, Staples, The World Bank Group, and Univ of Pennsylvania.
Sterling Planet Carbon Offering directly mitigates environmental impact from personal or business-related carbon footprint with:
Sterling Planet Registry is a Registry for Compiling Environmental Credits Data by Account for:
Sterling PlanetSterling Planet, founded in 2000 was the first nationwide renewable energy marketer with almost 40 utility partnerships - most in the renewable industry and they serve over 400 commercial and institutional customers. They are leading the emerging White Tag™ market and are buyer and seller of environmental attributes -- RECs, White Tags(TM) and Carbon Credits.
Stragetic Partnerships are with: US EPA Gree Power Partnership; USEPA Climate Leaders; WRI Green Power Market Development Group; APX Environmental Products Registry; Center for Resource Solutions (Green-e); and Environmental Resources Trust (ERT - White Tags)
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