Here’s how to buy renewable energy from your power company

As carbon emissions from fossil fuels continue to warm the planet, eco-conscious consumers may be wondering if there is a way to purchase electricity from renewable sources without having to install technology like solar panels or windmills on their property.

In short, the answer is yes.

However, this option is not necessarily available to all homeowners and renters. It’s also often priced at a slight premium, experts say.

Renewable energy — including wind, solar, hydroelectric, geothermal and biomass — will account for about 21% of U.S. electricity generation by 2023, according to the U.S. Energy Information Administration.

Most of this (60%) comes from fossil fuels such as coal, natural gas and oil. These energy sources release carbon dioxide, a greenhouse gas that traps heat in the atmosphere and contributes to global warming.

The White House’s goal is to generate electricity without emitting greenhouse gases by 2035.

More and more individuals and organizations are choosing to move away from fossil fuels: Some 9.6 million customers purchased 273 terawatt hours of renewable energy through the voluntary green electricity market in 2022, according to the National Renewable Energy Laboratory. This is a five-fold increase from 54 TWh in 2012.

In the voluntary market, customers purchase renewable energy from utilities in excess of state minimum requirements. More than half of U.S. states have policies to increase the share of electricity generated from renewable energy, but most goals are still years away.

As of 2016, voluntary purchases accounted for 28% of the renewable energy market (excluding hydropower), according to the EPA. The EPA says they help increase overall demand for renewable electricity, driving changes in the energy mix.

According to NREL’s estimates, most of the growth will come from businesses. Home sales also grew, but at a slower pace.

According to NREL’s most recent survey data on the subject, released in 2011, only one in six U.S. adults knows they have the option to purchase renewable energy from electric utilities or other suppliers.

“The market does continue to grow every year in terms of sales and number of customers,” said Jenny Sumner, manager of the NREL Modeling and Analysis Group at the U.S. Department of Energy’s National Laboratory.

“But few people realize” they can choose to participate in green programs, she said. “For most people, it’s not the most important thing.”

For example, a power company may offer a “green pricing plan.”

According to the U.S. Department of Energy, customers participating in these programs, also known as utility green power programs, pay a “small fee” to the utility company to receive electricity from renewable sources.

That cost is typically about 1 to 2 cents per kilowatt-hour higher than the utility’s standard electric service cost, Sumner said.

That roughly translates into an increase of about $5 to $15 a month, Sumner said. She added that this will ultimately depend on factors such as plan price and home energy use.

Nearly half of Americans (47%) say they would pay more to get their electricity from 100% renewable sources, according to a 2019 poll from the Yale Climate Change Communication Project. On average, they said they were willing to pay $33.72 more per month.

Green Power Marketing Plan

Consumers in some states can also choose to participate in the Green Power Marketing Program.

These states have “competitive” energy markets, meaning consumers can choose from many different companies to generate electricity. (Unlike the Green Pricing Plan, the company generating the renewable energy may not be the customer utility responsible for distributing the electricity.)

Residential green power options available in these states with competitive (also called “deregulated”) markets: California, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan , New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Texas and Virginia, according to the U.S. Department of Energy and the U.S. Environmental Protection Agency.

These powers also tend to come at a premium, although in some areas they “may be price competitive with preset power options,” the agencies wrote.

community choice aggregation

Through the Community Choice Aggregation scheme, local governments purchase electricity from alternative green electricity suppliers on behalf of residents.

Sumner said the city is essentially the provider of electricity to the community. These programs are especially common in California, she said.

Unlike other program types, residents typically do not have to opt into community choice programs; Sumner said this is usually automatic and consumers can opt out if they wish.

Consumers choosing renewable energy doesn’t mean electricity is injected Their Homes come from these renewable energies.

This may sound strange. But this is due to the physical nature of electricity and its movement through the shared grid.

“Once electrons are injected into the grid, there’s no way to label whether those electrons are ‘green’ electrons or not,” said Joydeep Mitra, director of MSU’s Power Systems Program. “No one has Know which electrons are going where.”

Instead, green energy plans rely on “renewable energy certificates,” or RECs.

Mitra said the certificates are essentially an accounting mechanism for renewable energy generation and purchases.

You may not have access to green energy—but someone, somewhere does. REC keeps track of it all.

Any consumer—even those who cannot participate in green power programs through their utility—can purchase RECs as separate, stand-alone products. It’s a way to provide additional funding for renewable energy projects, which are typically sold by brokers or marketers rather than utilities, Sumner said.

Purchasing these certificates separately will not affect a consumer’s existing utility service relationship.

Experts recommend choosing green power options, or RECs, that have been verified by an independent third party.

This is because the voluntary sales and purchases of renewable energy are not subject to government oversight, according to the EPA and the U.S. Department of Energy.

One such independent agency is the Center for Resource Solutions, a nonprofit organization that oversees Green-e certification standards, the agencies said.

For example, Green-e monitors the renewable energy information disclosed by energy suppliers to consumers and verifies whether purchases of this energy count towards national energy directives, among other things.

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