Dear Dot,
I was thrilled to hear from a friend that Martha’s Vineyard runs entirely on renewable energy from Cape Light Compact but that some people opt out. Why would they do that?
–Rick, West Tisbury
Dear Rick,
Let me walk you through the world of green energy and green energy credits because it is a confusing world and we can keep each other company while we try to discern what, exactly, it means when your friend tells you that Martha’s Vineyard runs entirely on renewable energy. Perhaps you wonder, as I did, whether this means that the energy consumed by all of us on Island comes from wind, or solar, or geothermal, or tidal, or some combination. But this is not the case,
according to Mariel Marchand, power supplier planner for Cape Light Compact. Mariel emitted a deep sigh when I asked her to explain because she is a lovely, patient person who admits that “this stuff is confusing and kind of hard to convey” and yet her job remains to convey it to dummies like me.
So let’s begin: Massachusetts, like many other states, has what’s called the Clean Energy Standard, which requires certain power suppliers to match a certain percentage of their customers’ usage with renewable energy credits (typically referred to as RECs). This amount has been increasing 2% each year, and is increasing further to 3% in 2025. Those credits, she explained, are generated by different renewable energy generating facilities, the “voluntary” renewable energy credits from the Midwest and Texas because it’s typically cheaper. Wait, what? We’re getting green energy credits, whatever that means, from Texas?
Mariel sighed. “It’s very complicated, unfortunately.”
She tried again.
“I wouldn’t think about it in terms of what percentage of the electricity on the grid is used by Martha’s Vineyard. It’s more that any power that Cape Light Compact is providing to our customers, we have to match a certain percentage of that energy with renewable energy credits, and then we’re matching an additional amount to get to 100%.”
I scratched my head, which was beginning to throb.
Let us now take a detour into what renewable energy credits are precisely because, honestly, Rick, I was somewhat mystified. I turned to the brilliant Dr. Volts (aka climate journalist David Roberts) who provided an explainer for Vox: “When a renewable energy generator — a wind farm or solar power plant, for example — generates a megawatt-hour (MWh) of power, it creates … electricity, which it can sell at prevailing market rates. And under federal law, it receives one REC, a certificate saying that it generated one MWh of electricity from clean sources, which it can also sell. This means every renewable generator in the U.S. (as long as it meets certain criteria) has two revenue streams, electricity and RECs.”
A-ha. Rick, I am starting to get it. What Mariel and Dr. Volts are saying is that a renewable energy credit sort of represents clean energy (or, as Mariel clarified “renewable attributes specifically”) rather than is the clean energy itself. It puts a value on clean energy production.
It also, as Dr. Volts explained, gives green energy providers two revenue streams. “The electricity is sold as KWh. The greenness is sold as RECs,” Dr. Volts wrote. “A REC is effectively a certificate of property rights over one unit of greenness.” But, and here’s an important point, the “greenness” of these credits are only realized when the credit is retired, or taken out of circulation.
So, back to us on the Vineyard. When your friend tells you that Cape Light Compact is 100% renewable, what they mean is that Cape Light has purchased enough renewable energy credits to reach 100% of the power consumption and then retired them.
It all seems a bit murky, doesn’t it? Like some sort of eco shell game. But it is, in fact, legitimate and useful because it takes green energy to the market and, ultimately, boosts the production of green energy. Or, as Dr. Volts puts it, “think of buying RECs not primarily as a blow against fossil fuels or carbon emissions, but as a (modest) blow for clean energy.” And rest assured, these renewable energy credits are tightly monitored.
What does this mean for you and me, Rick? Well, while Eversource owns the poles and the wires on the Island, we choose our electricity supplier. Some of us get Eversource basic service, some choose Cape Light Compact, some sign up with another competitor. If you are one of the 75% of people on the Island who choose Cape Light Compact, you are part of this portfolio that purchases (and retires) renewable energy credits to make up 100% of consumption. If it matters to you that this clean energy is produced in New England (which is typically more expensive to purchase than in the Midwest and Texas), Cape Light has Class One credits, which means they’re generated closer to home.
The cost of Cape Light’s power varies, says Mariel. Sometimes it’s slightly higher than Eversource Basic Service, sometimes it’s slightly lower. “We do our best to be slightly below,” she says, “but it doesn’t always happen.” Vineyard Wind will, of course, green the grid in New England but Cape Light Compact won’t be specifically selling its wind energy directly to customers.
Why might someone opt out of this? I can’t speak for those that do but I suspect it comes down to an (inaccurate) assumption that it will cost more.
I tell Mariel that I am beginning to sense a green light going off in my head. She tells me that customers can learn more by going to Cape Light’s site, but, I’ll be honest, I did and it’s not as pleasant and patient as Mariel, who, really, is just “excited for more people to know that they are on our supply.”
Renewingly,
Dot
