Utility Green Power Products
What is a Utility Green Power Product?
A utility green power product is an optional green power productoffered by a customer's default utility supplier. Sometimes referred to as green pricing, these are "bundled" products that include both renewable energy certificates (RECs) and electricity. Participating customers usually pay a per-kilowatt-hour premium through an additional line item on their monthly electric utility bill to shift from the standard offering to renewable electricity.
Roughly 850 utilities nationwide, ranging from investor-owned to municipal and cooperative utilities offer utility green power product(s) to their customers 1, which can include both residential and commercial consumers. According to NREL's 2017 Status and Trends in the Voluntary Green Power Market report, utility green pricing programs sold eight billion kWh of renewable energy to 816,000 customers in 2016, and utility green pricing programs grew by six percent relative to 2015 2.
How do Utility Green Power Products work?
Most utility green power products are structured as either block products or percent of use products. With the first type, customers choose how many “blocks” of renewable electricity to buy each month, usually in increments of 100 kWh (although some programs offer much larger block sizes to commercial customers). With a percent of use product, customers elect to source a percentage, say 25%, 50%, or 100% of their electricity bill from renewable sources, which means that the monthly green power use fluctuates with electricity usage. Customers can typically subscribe or unsubscribe to a utility green power program at any time, on a month to month basis.
When customers sign up for a green power product, the utility either generates renewable energy itself or procures it from elsewhere and retires RECs on behalf of the customer in proportion to the quantity of green power purchased by the customer.
Advantages and Challenges of Utility Green Power Products
Advantages:
- Easy procurement transaction with little expertise needed
- Customer can maintain or expand upon existing relationship with default energy supplier
- Customers can generally subscribe or unsubscribe at any time (e.g. no long-term contract)
- Procurement method is easy for customer to explain to stakeholders
- Green power is often sourced from local or regional resources
Challenges:
- Often has a larger price premium than other green power procurement options
- Customer's default utility may not offer a green power program
- May offer less of a direct connection to a specific renewable energy project
- Customer usually has no say in composition of resource mix or which renewable energy projects the green power is sourced from
What are some organizations that have used Utility Green Power Products?
Partner Case Study
"We are extremely excited to be partnering with Dominion Green Power for our 21st season here in Richmond. We have always been conscious of the environment and the impact that we have on our surrounding community. Partnering with Dominion was the next logical step in demonstrating our commitment to minimize our carbon footprint and demonstrate social responsibility." - Hunter Leemon, Director of Sales for the Richmond Kickers. 3
Additional Resources:
- National Renewable Energy Laboratory, 2001. Green Pricing Programs: What Defines Success? (PDF) (26 pp, 983K) Exit
- NREL, 2017. Status and Trends in the U.S. Voluntary Green Power Market (2016 Data). (PDF) (63 pp, 6.8MB) Exit
- Center for Climate and Energy Solutions, 2017. Map of States with Mandatory Green Pricing Programs Exit
- U.S. Department of Energy, Green Power Network. 2017. Accessed through the Wayback Machine, July 2018. https://web.archive.org/web/20170110230046/http://apps3.eere.energy.gov/greenpower/markets/pricing.shtml?page=4 Exit
- https://www.nrel.gov/docs/fy18osti/70174.pdf (PDF) (63 pp, 6.8MB) Exit
- http://www.richmondkickers.com/news_article/show/868965 Exit