Ryan's Journal

"My life amounts to no more than one drop in a limitless ocean. Yet what is any ocean, but a multitude of drops?" — David Mitchell

Lafayette, California

Posted at 12:00 am, February 8th, 2005

I’ve recently been doing some research into Green Certificates, which are basically a way for private individuals to subsidize the production of wind, solar, and low-impact hydroelectric power. The concept is the following:

  1. Assume it costs seven cents per kWh to produce conventional (coal, oil, gas) electricity, and eight cents per kWh to produce clean (wind, solar, low-impact hydro) electricity. Only those individuals living in a market where clean energy is available who are also willing to pay a premium will drive demand for clean energy.
  2. What a green certificate does is allow someone like myself to subsidize the production of clean energy by paying the one cent cost premium. Now the utility that produces clean energy can sell its energy to individuals for the same price as conventional power.
  3. U.S. law requires that, if there is no cost differential, utilities give buying preference to clean energy, so by removing the cost differential I have guaranteed that a certain amount of energy has been produced by clean technology instead of conventional technology.
  4. As a result of this transaction, even if the energy I use is produced by conventional means, I will have offset that impact by guaranteeing that clean energy has replaced conventional energy somewhere else on the power grid.

A list of companies offering such certificates is available here.

Strangely enough, one of the new backers of clean energy are the neo-conservatives. Their reasoning is that reducing energy usage lessens dependence on the Middle East, but their support could make for some very strange alliances with environmental groups.

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