September 2004 • NREL/TP-620-36823 Green Power Marketing in the United States: A Status Report Seventh Edition Lori Bird and Blair Swezey National Renewable Energy Laboratory 1617 Cole Boulevard, Golden, Colorado 80401-3393 303-275-3000 • www.nrel.gov Operated for the U.S. Department of Energy Office of Energy Efficiency and Renewable Energy by Midwest Research Institute • Battelle Contract No. DE-AC36-99-GO10337 September 2004 • NREL/TP-620-36823 Green Power Marketing in the United States: A Status Report Seventh Edition Lori Bird and Blair Swezey Prepared under Task No. ASG4.1003 National Renewable Energy Laboratory 1617 Cole Boulevard, Golden, Colorado 80401-3393 303-275-3000 • www.nrel.gov Operated for the U.S. Department of Energy Office of Energy Efficiency and Renewable Energy by Midwest Research Institute • Battelle Contract No. DE-AC36-99-GO10337 NOTICE This report was prepared as an account of work sponsored by an agency of the United States government. Neither the United States government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States government or any agency thereof. Available electronically at http://www.osti.gov/bridge Available for a processing fee to U.S. Department of Energy and its contractors, in paper, from: U.S. Department of Energy Office of Scientific and Technical Information P.O. Box 62 Oak Ridge, TN 37831-0062 phone: 865.576.8401 fax: 865.576.5728 email: mailto:[email protected] Available for sale to the public, in paper, from: U.S. Department of Commerce National Technical Information Service 5285 Port Royal Road Springfield, VA 22161 phone: 800.553.6847 fax: 703.605.6900 email: [email protected] online ordering: http://www.ntis.gov/ordering.htm Printed on paper containing at least 50% wastepaper, including 20% postconsumer waste Table of Contents Overview of Green Power Marketing in the United States .............................................................1 Introduction.............................................................................................................................1 Utility Green Pricing Programs ..............................................................................................2 Competitive Green Power Markets.........................................................................................6 Renewable Energy Certificate Markets ................................................................................11 Summary and Observations ..................................................................................................13 Utility Green Pricing Programs .....................................................................................................16 Competitive Green Power and Renewable Energy Certificate Marketing ....................................39 Retail Green Power and REC Marketers ..............................................................................39 Utility/Marketer Partnerships................................................................................................46 Selected Wholesale Marketers..............................................................................................47 Certificate Brokers................................................................................................................49 Selected Green Power Customers..................................................................................................50 Businesses.............................................................................................................................50 Universities ...........................................................................................................................53 Local Government ................................................................................................................56 State Government..................................................................................................................58 Federal Government..............................................................................................................59 References......................................................................................................................................62 Appendix A....................................................................................................................................63 List of Tables Table 1: Price Premiums Charged for Utility Green Pricing Products ...........................................3 Table 2: Estimated Cumulative Number of Customers Participating in Utility Green Pricing Programs...............................................................................................................4 Table 3: Customer Participation Rates in Utility Green Pricing Programs by Year.......................5 Table 4: Annual Sales of Green Energy through Utility Green Pricing Programs .........................5 Table 5: New Renewable Energy Capacity Supplying Green Pricing Programs (2003)................6 Table 6: Cumulative Number of Customers Purchasing Green-e Certified Power........................8 Table 7: Annual Sales of Green-e Certified Green Energy in Competitive Markets .....................9 Table 8: New Renewables Capacity Supplying Competitive Markets and Renewable Energy Certificates (2003)..............................................................................................10 Table 9: Number of Customers and Sales of Green-e Certifited REC Products ..........................13 Table 10: Estimated Green Power Customers and Sales by Market Segment (2003)..................13 Table 11: New Renewables Capacity Supplying Green Power Markets (2003)..........................14 Table A-1: Utilities Offering Green Pricing Programs.................................................................63 Table A-2: Utility Green Pricing Programs by State....................................................................64 Table A-3: Retail Green Power Product Offerings in Competitive Electricity Markets ..............73 Table A-4: Renewable Energy Certificate Product Offerings ......................................................78 List of Figures Figure 1: U.S. Map of Green Pricing Activities............................................................................2 Figure 2: States with Competitive Green Power Offerings...........................................................7 iii Acknowledgments This work was funded by the U.S. Department of Energy’s (DOE) Office of Energy Efficiency and Renewable Energy (EERE). The authors wish to thank Linda Silverman, David McAndrew, and the DOE renewable energy technology programs for their support of this work. The authors also wish to thank Ed Holt of Ed Holt and Associates Inc., Gabe Petlin of the Center for Resource Solutions, John Halley and Byron Woodman of Community Energy Inc., and Jørn Aabakken of NREL for their thoughtful review of the document; as well as Michelle Kubik of NREL for her editorial support. Finally, the authors wish to thank the many industry contacts that provided much of the information summarized in this report. Additional information on green power market trends and activities can be found on the U.S. DOE’s Green Power Network Web site (http://www.eere.energy.gov/greenpower/). iv An Overview of Green Power Marketing in the United States Introduction Voluntary consumer decisions to purchase electricity supplied by renewable energy sources represent a powerful market support mechanism for renewable energy development. Beginning in the early 1990s, a small number of U.S. utilities began offering “green power” options to their customers. Since then, these products have become more prevalent, both from utilities and in states that have introduced competition into their retail electricity markets. Today, more than 50% of all U.S. consumers have an option to purchase some type of green power product from a retail electricity provider. Currently, about 15% of utilities offer green power programs to customers in 34 states. These programs allow customers to purchase some portion of their power supply—almost always at a higher price—as renewable energy or to contribute funds for the utility to invest in renewable energy development. The term “green pricing” is typically used to refer to these utility programs offered in noncompetitive electricity markets. In some competitive (or restructured) retail electricity markets, electricity customers can purchase electricity generated from renewable sources by switching to an alternative electricity supplier that offers green power. To date, nearly a dozen states that have opened their markets to competition have experienced some degree of green power marketing activity. Finally, any consumer can purchase green power through renewable energy certificates (RECs), which represent the unique or “green” attributes of