NREL/PR-6A20-63279 

NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Changing Dynamics in the 

Voluntary Market

Renewable Energy Markets Conference

Sacramento, California

Jenny Heeter

December 4, 2014 
2

Purchasing Options are Expanding

Direct project investment/crowdfunding

Large customer renewable energy tariff

Power purchase agreements

Community solar

Community choice aggregation

Utility green pricing

On-site renewables

Unbundled Renewable Energy Certificates (RECs)

Competitive supplier

• Match all or part of 

electricity consumption 

with renewable energy

• Meet corporate 

sustainability goals

• Provide location for 

renewable 

development

• Potentially lower 

electricity bill

• Meet municipal GHG 

reduction targets

• Support local solar 

development

• Potential price hedge

Purchaser 

keeps RECs

Purchaser 

does not 

necessarily 

keep RECs

Existing and emerging purchasing methods Value proposition REC treatment
3

Voluntary Market Increases to 62 Million MWh

The overall voluntary market continues to exhibit strong growth, with the 

largest increase coming from the competitive markets. 

0

10

20

30

40

50

60

70

Million MWh

Community Choice

Aggregation

Competitive Markets

Utility Green Pricing

Unbundled REC

Markets

(CCA)

*Voluntary sales for 2011 are estimated as the mid-point of 2010 and 2012 sales.

Competitive markets up 25%

Utility green pricing up 15%

Unbundled REC markets up 1%
4

Voluntary Supply Dominated by Wind

In 2013, 75% of the supply for the voluntary market came from wind. Solar 

energy provided approximately 2.5% of supply for utility green pricing 

programs.

Wind

75%

Landfill gas 

and biomass

7% Hydro

4%

Solar

1%

Geothermal

1% Unknown

12%
5

CCAs Support 9 million MWh of RE

CCA enabled

▪ Marin 

Clean 

Energy 

▪ Sonoma 

▪ > 100 cities

and towns

▪ Cincinatti

▪ Cleveland

▪ Cape Cod and 

Martha's 

Vineyard

▪ Lancaster

▪ 36 

municipalities 

(5%-10% 

renewable 

▪ Lambertville

▪ West Amwell 

(opt-in 

program by 

First Energy 

Solutions)

CCAs supported 9 million MWh of renewable energy; 2.4 million customers 

participating. Some CCAs are interested in sourcing more local supply.
6

Major Green Pricing Programs Increase

• Sales by utility green pricing programs 

increased 15% between 2012 and 2013.

o Some of our Top 10 programs saw large increases 

in sales. Other programs still losing customers and 

sales.

– PGE increased sales by 26% 

– Austin Energy increased sales by 16%. 

– CPS Energy increased sales by 14%. 

– TVA was new to our Top 10 list with nearly 200,000 

MWh in sales.
7

A Few Utilities Offering RE Tariffs; Success Remains to 

Be Seen

• Duke, NV Energy, and Dominion Virginia have 

created renewable energy tariffs for large 

customers

• Action underway in Oregon to establish a 

renewable energy tariff; per House Bill 4126

• Tariff rates typically include fees and 

administrative charges, plus the cost of the 

renewable energy resource

• Subscription rates TBD
8

Utilities Using Mix of Unbundled and Bundled RECs; Contract 

Length Varies by Procurement Mechanism

Contract 

length

Unbundled 

RECs

RECs 

bundled with 

electricity

Owned by utility

RECs 

produced 

by utility 

consumers

≤1 year 46% 0% 0% 0%

2-5 years 52% 0% 0% 19%

6-10 years 2% 5% <1% 4%

11+ Years 0% 95% >99% 77%

Percent of 

total 

procurement

55% 36% 7% 2%
9

Voluntary Action in Texas Increase from 2012; Still Below 2011 

Levels

Source: ERCOT, 2008-2014

Voluntary retirements in ERCOT increased slightly in 2013, when retirements 

for previous years are included. In 2013, 7.4 million MWh were for retired for 

2013 and 7.5 million MWh were retired for previous years. 

0

5

10

15

20

25

2007 2008 2009 2010 2011 2012 2013

Millions of MWh

ERCOT Voluntary

Retirements from

Previous Years

ERCOT Voluntary

Retirements from

Current Year

ERCOT RPS

Retirements
10

Strong Growth for Community Solar

• Community solar is a 

popular niche within 

the voluntary market, 

and a number of 

additional programs 

are planned. The 

installed capacity to 

date is still quite small 

(≈ 40 MW) in the 

context of the larger 

green power market.

• Large scale community 

solar programs are 

under development in 

California, per AB 43.

0

10

20

30

40

50

60

70

80

0

10

20

30

40

50

60

Number of Programs

MW

Cumulative Capacity

Cumulative Number of

Programs
11

Washington Post: “Using the Web? Congrats, you’re an 

environmentalist”

The largest 70 information and communications technologies (ICT) companies 

purchased 8.4 million MWh of RE in 2013.

Data centers alone account for ~2% of U.S. electricity use.
12

0

1

2

3

4

5

6

Voluntary REC price ($/MWh)

National Wind

Voluntary REC Prices Up to >$1/MWh in 2013

Source: Marex Spectron 2014

Voluntary REC prices started to rise in mid-2013 after years of decline; September 

prices more than $1/MWh. The increased price may be due to tightening in the Texas 

market. By fall 2014, prices had declined to under a dollar, with a few trades less than 

$0.80/ MWh.
13

Summary

• Green power market totaled 62 million MWh in 2013, 

up from 48.6 million MWh in 2012.

• Approximately 5.4 million customers are purchasing 

green power; 2.4 million of those are participating in 

CCAs.

• Utility green pricing sales and competitive market sales 

increased by 15% and 25%, respectively, while the 

unbundled REC market saw very modest growth and 

was nearly flat.

• REC prices in 2013 increased to >$1/MWh; have since 

declined.

• Community solar continues to expand.

• ICT sector makes up more than 10% of voluntary 

market; is procuring in innovative ways.
14

Additional Information

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NREL is a national laboratory of the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, operated by the Alliance for Sustainable Energy, LLC.

Contact Information:

Jenny.Heeter@nrel.gov

303-275-4366

Full report available:

http://www.nrel.gov/docs/fy15osti/63052.pdf 

http://greenpower.energy.gov