By Stream Energy Director of Market Research Mike Rowley
Green is a defined term that may or may not mean clean. In the State of Texas, for instance, Green is a legal term that includes solar, wind, geothermal (using underground heat to create electricity) and Biomass (burning residential waste, farm and dairy waste and manufacturing waste that is not toxic in nature). Biomass green electricity can also come from the burning of tree trimmings and brush. High-efficiency natural gas generators that pollute less than a regulated limit can also be qualified as a “green” generation source.
Clean is generally not a legal term, but it implies that the process for creating electricity creates no pollutants at all.
Renewable is a term used for electricity generation that has a fuel that will never be depleted. Combustible trash from a landfill is considered a fuel source to which we will always have access. In the lumber industry there is an inordinate amount of bark and wood shavings that cannot be used to manufacture other useful products. Burning this waste is considered renewable and green; but because it is burned, it will most likely produce some sort of airborne pollutant, so it does not qualify as clean.
The methodology for green and renewable energy generators to collect on the added value of their product is called the renewable energy credit (REC). When a generator produces electric energy, it sells that energy in the same market as any other generator of electricity. However, green/renewable generation is awarded a REC for every megawatt of power it produces to recognize the cleaner energy it produces. So, every time green or renewable energy is produced, its RECs are sold into a market designed to reward the green/renewable generator for not polluting. Stream Energy purchases these RECs to supply our customers who want a green product so that our customers can feel confident that they are truly making a positive impact on the environment.
Simply put, when you purchase Stream Energy’s green and clean product, you are incentivizing the electricity industry to make electricity with renewable energy sources and to build more green and clean electricity generators to make even more renewable electricity.