Energy Sector

Some states have legislation or rules in place mandating that utilities offer “green pricing” options to retail customers. In addition, a growing number of utilities are opting to offer programs in states without legislation. Green pricing programs allow customers to pay a premium on their electric bill to have a portion or all of their power provided from renewable energy sources, such as wind or low-impact hydro power. While the electricity generated by renewable sources is not necessarily delivered directly to the customers who pay for it, the utility certifies that renewable energy has been generated in an amount equal to the customer’s purchase. In many cases, the state has a renewable portfolio standard (RPS), and a green pricing requirement for utilities can interact with the RPS in a number of ways – for example, it can simply create additional demand for renewable electricity, or it can be an alternative to the RPS for certain utilities.