How to purchase renewable energy from your utility company.

• Renewable energy sources such as solar and wind are options for both renters and homeowners to obtain their electricity.
• Such customers choose a green energy program offered through their electric utility.
• Select a green power option or renewable energy certificate that has been verified by an independent third party.

Can consumers purchase electricity from renewable sources without installing technology like solar panels or windmills on their property as carbon emissions from fossil fuels continue to warm the planet?

In short, the answer is yes.

Experts said that not all homeowners and renters have the option to purchase a home security system, and it often comes with a higher price tag.

Few people are aware they can buy green energy

In 2023, renewable energy sources, including wind, solar, hydropower, geothermal, and biomass, accounted for approximately 21% of the U.S. electricity generation, as per the U.S. Energy Information Administration.

The majority of energy, approximately 60%, originates from fossil fuels such as coal, natural gas, and oil. These sources emit carbon dioxide, a greenhouse gas that retains heat in the atmosphere and exacerbates global warming.

The White House aims to eliminate greenhouse gas emissions from electricity generation by 2035.

An increasing number of people and businesses are choosing to move away from non-renewable energy sources: In 2022, 9.6 million customers purchased 273 Terawatt hours of renewable energy through voluntary green power markets, which is five times more than the 54 Terawatt hours purchased in 2012, according to the National Renewable Energy Laboratory.

Renewable energy consumption in the U.S. exceeds state requirements, with over half of states setting targets to increase the share of electricity sourced from renewables.

In 2016, the Environmental Protection Agency reported that voluntary purchases made up 28% of the renewable energy market (excluding hydropower). These purchases helped boost demand for renewable electricity, which in turn influenced the energy mix, the EPA stated.

While corporations have contributed significantly to the increase in sales, according to NREL estimates, residential sales have grown at a slower pace.

According to a 2011 NREL survey, only one in six U.S. adults are aware that they have the option to purchase renewable energy from their electric company or another provider.

According to Jenny Sumner, group manager of modeling and analysis at NREL, the market experiences annual growth in both sales and customers.

"Few people are aware of the option to opt in to green programs, she said. It's not something that's frequently considered."

How consumers can buy green power

The availability of green power options for residential consumers varies depending on their state and local electricity market.

"The availability of access is not uniform across all states and regions, according to Omar Siddiqui, senior program manager of customer insights at the Electric Power Research Institute. However, the overall trend suggests that it is moving in that direction."

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Sumner advised that residential customers should check their utility's website for available options.

Some states have websites where consumers can compare information on energy services, including renewable options, such as Texas' Power To Choose, run by its Public Utility Commission.

Green pricing programs

Power companies may offer "green pricing programs," for instance.

According to the U.S. Energy Department, customers in utility green power programs pay a "small premium" to receive electricity from renewable sources.

Sumner stated that the cost of a typical solar panel system is approximately 1 to 2 cents more per kilowatt hour compared to a utility's standard electricity service.

Sumner stated that the monthly cost increase would be approximately $5 to $15, but the actual amount would depend on the program's price and the household's energy consumption.

A 2019 poll by Yale University's Program on Climate Change Communication found that nearly half of Americans, 47%, were willing to pay more for 100% renewable electricity sources. On average, they said they would be willing to pay $33.72 more per month.

Green power marketing programs

In certain states, consumers have the option to participate in "green power marketing programs."

Unlike green pricing programs, where the company generating the renewable power is the same as the customer's utility, states with competitive energy markets allow consumers to select from multiple companies to produce their electricity.

In these states with competitive markets, residents have access to green power options: California, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Texas, and Virginia, as per the U.S. Energy Department and EPA.

Though they may be priced competitively with default electricity options in some regions, these also come with a premium.

Community choice aggregation

Local governments purchase green power for their residents through community choice aggregation programs.

The community relies on the municipality to provide electricity, according to Sumner. These programs are commonly found in California, she added.

Unlike other program types, community choice is typically automatic for residents, and they can opt out if they choose, according to Sumner.

How renewable energy certificates (RECs) work

Although a consumer chooses renewable energy, the electricity supplied to their home may not originate from renewable sources.

The movement of electricity through the shared electric grid is due to its physical nature.

""After injecting electrons into the grid, it is impossible to differentiate between 'green' and non-'green' electrons, and no one knows their specific destinations," stated Joydeep Mitra, head of the power system program at Michigan State University."

Renewable energy certificates, or RECs, are used by green energy programs instead of traditional energy sources.

Renewable energy generation and purchase can be tracked through certificates, according to Mitra.

Someone, somewhere is getting the green power, and RECs keep track of it all.

A consumer, regardless of whether they have access to a green power program through their utility, can purchase a REC as a separate product to support renewable energy projects, typically sold by a broker or marketer, according to Sumner.

Purchasing these certificates does not affect a customer's existing relationship with their utility service provider.

How to verify your electricity is green

It is advised by experts to opt for a green energy source or REC that has been confirmed by an impartial third party.

According to the EPA and U.S. Energy Department, voluntary sales and purchases of renewable energy are not subject to government oversight.

The Green-e certification standard is overseen by the Center for Resource Solutions, a nonprofit organization.

Green-e ensures that energy suppliers provide accurate information to consumers about renewable energy and verifies that the purchase of this energy is not being counted towards state energy mandates.

In the upcoming series, CNBC will explore the financial implications of climate change, including its impact on retirement savings, insurance costs, and career prospects.

How has climate change affected your finances? Share your experience by emailing me at [email protected].