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REC's

The Government's Mandatory Renewable Energy Target (MRET) supports the reduction of Australia's greenhouse gas emissions by increasing the proportion of Australia's electricity that is derived from renewable energy sources. This is achieved through a market-based certificate trading scheme. The commodity in this market is the Renewable Energy Certificate (REC) - each REC represents the equivalent of one megawatt (MWh) hour of electricity generation from an accredited renewable energy source such as solar energy.

The MRET places a responsibility on every retailer of electricity to source a proportion of their electricity from renewable energy sources, and they are known under the scheme as liable parties. In order to meet their responsibility, the liable parties are required to surrender an appropriate number of REC to the Office of the Renewable Energy Regulator annually - this proves that enough renewable electricity has been generated.

There is a default value that electricity retailers are required to pay if they do not meet their required targets, although if they do not meet their targets they are also 'named' in federal parliament, which companies prefer to avoid.

There are two ways the liable party can source the RECs: either from their own sources of generation and create RECs, or they can buy the rights to create RECs from owners of small renewable energy systems. This is what people might know as a RECs rebate, and liable parties usually buy RECs through an agent or some other third party.

For more information about RECs, Renewablelogic on 1300 39 10 77. Or alternatively you may email your enquiries to recs@renewablelogic.com.au

New: Renewablelogic has access to better and more stable REC

pricing. Prices posted fortnightly.

Current REC buy prices (conditions apply) Contact us on recs@renewablelogic.com.au for further information.

From 15 January 2010 to 30 January 2010: REC already created: $31.75, Forward price (not created, but guaranteed creation price until 30 Jan 2010): $28.60.

From 01 February 2010 to 14 February 2010: REC already created: $32.00, Forward price (not created, but guaranteed creation price until 14 February 2010): $29.60.