What is the importance of renewable energy credits (RECs) in LADWP’s programs?

Renewable energy credits (RECs) play a crucial role in supporting and certifying the generation of renewable energy. Each REC represents the environmental benefits associated with the production of one megawatt-hour (MWh) of renewable energy. When renewable energy is generated, a REC is created to track and represent that energy’s environmental attributes. This process not only proves that renewable energy is generated but also helps incentivize further renewable development.

The importance of RECs can be seen in how they contribute to the broader goals of sustainability and energy policy. By purchasing RECs, entities can demonstrate compliance with renewable energy mandates or policies, which is increasingly significant for utility providers like LADWP as they aim to transition to a more sustainable energy model. Furthermore, RECs can be sold or traded, which creates a market incentive for the development of renewable energy projects.

This system of RECs is vital for meeting renewable energy targets and for promoting the growth of clean energy sources, as it directly correlates with the investment and production required to reduce carbon emissions and combat climate change.