Environmental Attribute Certificates (EACs)
What Is an EAC?
An Energy Attribute Certificate (EAC) is a tradable certificate representing the environmental attributes of electricity generated from renewable resources. Primarily employed to verify the renewable energy content of electricity, an EAC of 1MWh of renewable electricity denotes the environmental advantages of 1MWh of electricity generated from renewable energy sources like solar or wind.
Why Are EACs Important?
EACs allow companies to reduce their environmental footprint by endorsing clean energy, all without the necessity to switch their current power provider. Not only do EACs serve as a key instrument for aligning with the Greenhouse Gas Protocol and improving corporate sustainability ratings in line with RE100 goals, but they also provide an efficient means to integrate renewable energy into a global sustainability strategy.
Types of EACs
International Renewable Certificates
EAC standard adopted in regions such as Asia, Oceania, Africa, and Latin America
US Renewable Certificates
(US-REC and a.k.a REC)
Renewable Energy Certificates issued in the US and Canada
Country (Region) Specific Nature of EACs
EACs are country-specific. This signifies that if an organization intends to claim renewable energy use in a specific country or region, it is necessary to procure EACs specific to that country or region.
How to Trade EACs
There are the three main ways for a company to buy and sell EACs
This involves trading EACs directly with another company or individual. OTC trading is typically done on a one-off basis, and the price of EACs is negotiated between the two parties.
An aggregator is a company that acts as a middleman between buyers and sellers of EACs. Aggregators typically have a large network of buyers and sellers, which can give companies better prices on EACs.
Exchange or Marketplace
This involves trading EACs on an exchange or a marketplace. Exchanges and marketplaces provide a platform for buyers and sellers of EACs to meet and trade. The price of EACs on an exchange is determined by supply and demand.
To source EACs, a company can either purchase them directly from an EAC issuer, another company, or an individual. EAC issuers are typically renewable energy generators or energy retailers. The seller typically transfers the EACs to the buyer through an agreed-upon registry (for I-RECs, the registry is Evident), or the seller can choose to retire/redeem the EACs on behalf of the buyer or on another agreed-upon beneficiary.
A company can only claim to have used Renewable Energy if the company retires/redeems the purchased EACs in their name. Traders or other parties can retire/redeem EACs on behalf of other beneficiaries, but only the entity in which the EACs were retired/redeemed in can officially claim that they have used renewable energy. Retiring EACs is a voluntary process and once they are retired, the EAC issuer will then cancel the EACs and remove them from circulation to avoid “double-counting”
Interested in Learning More or Start Sourcing EACs?