Texas wind-power firms file to sell energy credits to N.C. utilities - Philadelphia Business Journal:

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Three Texas wind farms await approval to registetr as renewableenergy facilities. Registration is a requirementy of all renewable energy projectsa built inthe state. But these applications, filed by Houston-based energy development companyElement Markets, signak the entry of out-of-state companies anglinyg to satisfy the demandx that North Carolina utilities are goint to create for renewable generation due to new stated requirements. The Public Staff, the utilities commission’s consumer arm, has reviewer the files and recommende approval. North Carolina utilities won’t be purchasinvg power from these Texaswind farms.
Rather, they will be able to buy the “renewable energy credits.” “You’re paying for the renewable saysJames McLawhorn, director of the Public Staff’s Electric Renewable energy has a value beyonde the energy itself – in the form of a renewablew energy credit, or REC, that can be boughy and sold. North Carolina utilities would be interested in buying credits from Texas facilitiesw to help them meet state target forrenewable generation, McLawhorn says. The 2007 energhy legislation Senate Bill 3 requires North Carolina utilities togenerate 12.5 percent of their power from renewable sources by 2021.
Up to 25 percentf of that requirement can come frompurchasing out-of-state The Texas wind facilities are large: a 79.8 megawatt facility in Hansford County and two 10 megawatt facilities in Moord County. McLawhorn says the powee from the facilities is purchased byTexas utilities, but the glut of wind generation in Texasw means they have RECs to spare. Element business includes trading renewableenergu credits. The prefers renewable generation be built within a particular state so itsbenefitsa – the power generated and the jobs created stay in the state, says Wind Programm Coordinator Brandon Blevins.
But he adds that building any new renewablse energy facility takes time and that utilities face a deadlines to meet the renewablwgeneration targets. Purchasing RECs allows a utility to more quickly get renewabld generation intoits portfolio. Roger von Haefen, professore of agricultural and resource economicsat , says the pricee of an REC is set by marke forces. He expects demand for RECs to go up as demanr for renewableenergy increases, and particularly if federal legislationb creates additional requirements for utilities. Von Haefen says that in some RECs offer a less expensive way to supportgrenewable generation.
If Texas has superior wind energy directing North Carolina dollars to Texas makeas economic sense because it will bring more wind energy online atless cost, he explains. But RECs don’tr always translate into additional investment inenerg generation. In some cases, buying RECs pays the owners of the generatioj for something they would be doing Von Haefen is unfamiliar with theTexas facilities, but he says debatex about RECs and carbon offsets center arounx whether these policies create new renewablew generation.
“If we’re not, we’re not gettinf anything out of the policy other than movingg the credits around and raisingb costs for North Carolinautility customers,” von Haefenh says.