Environmental commodities
International Renewable Certificates (I-RECs)
What Is an I-REC?
I-REC is a type of EAC that is used to track and trace renewable energy on a global scale. Covering over 50 countries across Asia, Africa, the Middle East, and Latin America, I-RECs are issued by the non-profit organization I-REC Standard, dedicated to promoting the use of renewable energy. Each I-REC accounts for 1MWh of renewable electricity, providing details on its origin,technology, region, and vintage (year of production).
Why Are I-RECs Important?
I-RECs are pivotal in tracking and assigning ownership to renewable electricity generation and consumption, addressing the challenge posed by the utility grid’s inability to disclose electricity’s origin and method.
I-RECs ensure that individuals purchasing renewable energy truly receive it, bridging the gap in distinguishing renewable energy from other grid sources. This is achieved through meticulous tracking of renewable energy generation and its utilization (retirement/redemption).
Furthermore, I-RECs contribute to advancing the use of renewable energy and reducing greenhouse gas emissions. Companies leverage I-RECs to fulfill their RE100 goals and decarbonization initiatives. The redemption of I-RECs also serves as a tangible demonstration of a company’s commitment to sustainability and corporate social responsibility.
Due to growing global Net Zero and RE100 commitments, the demand for I-RECs is growing at a rapid pace: 100% annual growth rate since 2020.
Types of I-RECs
Types of I-RECs
I-RECs are issued and are available in 56 countries across Asia, Africa, Oceania, the Middle East, and Latin America.
Refer to the below map for countries that are a part of I-REC Standard.
Country Specific Nature of I-RECs
Country Specific Nature of I-RECs
An important aspect of I-RECs are that they are country-specific. This means if a company wants to claim that they are using renewable energy in a specific country, then the company must purchase I-RECs from that specific country. In other words, I-RECs are specific to the location where the renewable energy is generated and are used to claim that the electricity consumption comes from renewable sources in that region.
As an example, consider a multinational company operating in multiple countries that adhere to the I-REC Standard. To assert their utilization of renewable energy in each of these countries, the company must acquire I-RECs for each respective country of operation.
How to Trade I-RECs
There are three main ways for a company to buy and sell I-RECs:
- Over-the-counter (OTC): This involves trading I-RECs directly with another company, traders or individual. OTC trading is typically done on a one-off basis, and the price of I-RECs is negotiated between the two parties.
- Exchange or Marketplace: This involves trading I-RECs on a centralized exchange or a marketplace. Exchanges and marketplaces provide a platform for buyers and sellers of I-RECs to meet and trade. The price of I-RECs on an exchange is determined by supply and demand.
- Aggregator: An aggregator is a company that acts as a middleman between buyers and sellers of I-RECs. Aggregators typically have a large network of buyers and sellers, which can give companies better prices on I-RECs.
I-RECs are one of the main EACs traded on CnerG Marketplace. For corporate buyers looking to source I-RECs, for energy generators looking to sell I-RECs, or traders looking to simply trade I-RECs, CnerG Marketplace has you covered.
Interested in Learning More or Start Sourcing I-RECs?