Solar Panels vs. Renewable Energy Credits in Massachusetts: Pros and Cons
From Provincetown to the Berkshires, Massachusetts is rapidly becoming solar panel country. Spurred by tax relief on renewable energy sources, swayed by assertive marketing campaigns, and swelling with the forward-thinking spirit of the Commonwealth, homeowners have been signing up to generate energy from rooftop solar panels. The state has made this easier for homeowners by incentivizing banks and credit unions to increase lending for small solar projects. As a result, a solar array has been installed within the borders of nearly every town in Massachusetts.
Of course, even with banks incentivized to provide solar project loans, not every homeowner wants to take on the additional financial and physical burden of installing solar panels on their rooftop. For some, there might not be enough unshaded sunlight in their yard. For others, even a loan that can be paid off in five to six years may be an extra payment they’re unwilling to make. Many apartment dwellers and renters also wish to power their household renewably, but their landlords or property owners refuse to install solar panels. For these Massachusetts residents, there’s another option—Renewable Energy Credits.
Renewable Energy Credits (RECs) Offer an Alternative to Rooftop Solar
So what’s a Renewable Energy Credit (REC)? A Renewable Energy Credit is a way to purchase electricity from renewable sources, like solar, without needing to install your own power generator. Here’s how it works:
Renewable energy generators create power from the sun, wind, running water, and a host of other renewable resources. The energy is fed into the grid and the generators keep track of the exact amount produced. Once electricity leaves a solar array or power plant and enters the grid, it gets mixed in with all the electricity produced by every other power source attached to the grid. It’s no longer distinguished or separated from energy produced from all other resources. However, since the generation companies keep track of how much energy their power plant puts into the grid, they are able to offer the same amount of energy as Renewable Energy Credits—the RECs we talked about before.
Think of it this way: Each time a solar array or wind farm produces one megawatt hour (MWh) of electricity, they list that amount on the market as one REC. Third-party energy suppliers then purchase these Renewable Energy Credits on the market and offer them to consumers in green energy plans. When a consumer buys a Renewable Energy Credit, that uniquely-identified certificate of power is listed as used and retired. It’s a win-win-win for consumers, the environment, and the renewable energy generator.
Rooftop Solar vs. RECs: Which to Choose?
Both rooftop solar installations and Renewable Energy Credits have their place in Massachusetts. Both have their upsides and their downsides and which is better for you, ultimately, is up to you. To help you make an informed choice, we thought we’d break them both down for you, side by side.
|Rooftop Solar||Renewable Energy Credits|
|Reduces carbon emissions. Aside from the carbon emissions required to produce solar panels in the first place, powering your home with rooftop solar does not contribute any greenhouse gases to the environment. Further, it reduces the amount of emissions produced by other energy sources that would have been needed to power your home if you didn’t have solar panels.||Reduces carbon emissions. The energy produced with renewable credits is emissions-free, aside from the emissions it takes to create the materials for the power plant in the first place. Like rooftop solar, RECs reduce the amount of energy produced by non-renewable sources as well.|
|Express energy production. The energy produced by the solar panels on your roof comes directly from the sun and runs directly to your appliances. It’s like a farm-to-table take on electricity, except that both the farm and the table are yours.||No upfront costs. Switching to an energy plan with Renewable Energy Credits doesn’t involve laying out a down payment or adding new monthly installments to your budget. However, purchasing RECs is likely to be more expensive than your current average electricity rate.|
|Long-term productivity. Once your solar panels are paid for, they’ll lower your monthly energy costs every month they’re active. If you use less energy than your panels produce, you can even sell that energy back to the grid (through the utility). If you disconnect from the grid to rely entirely on solar, you’ll totally eliminate your electricity costs (but increase your risk of blackouts). Of course, this benefit only lasts for the lifetime of the panels—a reason to make sure your panels come from a quality supplier.||Flexibility. Switching to an energy plan with Renewable Energy Credits doesn’t require any long-term commitment. You’re not in debt to the bank and you don’t have anything on the roof. Also, if you move to a new home, you can take your REC plan with you—not so with solar panels. Lastly, any time you’d like to switch to a different energy plan, you have the freedom to choose.|
|On-site solar-energy guarantee. With solar panels, you’re 100% sure that the energy you’re using is solar power and not from a renewable source you haven’t heard about. Plus you know it’s benefiting the local environment and not coming from a power resource in a different state.||Promotes variety of renewable resources. RECs are generally sourced from a variety of clean energy generation—wind, sun, small hydro, biomass, and more—thus creating incentives for various types of clean energy. RECs also may be nationally-sourced, supporting the overall U.S. environment.|
|Rooftop Solar||Renewable Energy Credits|
|Long-term commitment. Once the solar panels are on your roof, the solar panels are on your roof. Taking them off adds another expense. You’ll also be making additional monthly payments until the loan is paid off—which could be many years.||Indirect energy production. When you purchase RECs, there’s no guarantee that the actual electricity running through your television was produced at a solar plant. However, it is certain that an equal amount of electricity was generated by green resources.|
|Added roof weight. Solar panels aren’t made of feathers. To put them on your roof, you need to make sure you have a sturdy enough roof to hold them. The panels will stay up there through the winter. In Massachusetts, that means taking into consideration the added weight of wet, heavy snow. The irregular profile of the panels will also make cleaning away that snow more difficult. If you don’t have one already, you may need to invest in a ladder—and, to be safe, a fall arrest system is a good idea. Rooftop work can be hazardous.||No added equity. Purchasing RECs vs. buying solar panels is sort of like renting an apartment vs. buying a house. While you’re still enjoying the same benefits of carbon neutral energy, you’re not adding value to your home with RECs. With solar panels, every monthly payment you make brings you closer to owning your own power plant.|
If you want to make sure your home is powered in a responsible, carbon-neutral manner, there are a couple ways to go about it. While solar panels are the more visible method of supplying your home with renewable energy, RECs provide the same energy benefits with greater flexibility and lower investment. For renters and homeowners unable or unwilling to make alterations to their homes, make the financial commitment or who simply live in high-shade locations, RECs may prove to be the ideal renewable energy solution.
At Liberty Power, we believe in the power of alternatives. As a third-party electricity supplier, it’s the nature of our business to improve the energy industry by offering an alternative to utility monopolies. That’s also why we take pride in offering Renewable Energy Credits to our customers. We want you to have the ability and the information you need to make the energy choice that’s right for you. Ready to make the switch to a green energy plan? We can help you get started today.
Photo Credit: Karsten Würth