From megawatts to carbon tons: Differenciating I-RECs from Carbon Credits

Often these two concepts are thought to be the same, or confused between each other. This said, understanding the differences between I-RECs and Carbon Credits it’s easier than you think:

I-RECs: Renewable Energy Attribute Certificates

I-RECs, or International Renewable Energy Certificates, are digital certificates that verify clean energy production. They serve as documentation confirming that a specific quantity of electricity was generated from renewable sources. These certificates are measured in megawatt hours (MWh) and function as a tracking mechanism for renewable electricity, from its generation at sources like wind farms or solar installations to its end-use consumption. In essence, I-RECs are renewable energy attributes that:

• Are measured in megawatt hours (MWh)

• Track renewable electricity from production to consumption

• Provide companies with evidence of renewable energy usage

Carbon Credits: Emissions Offsetting Instruments

Now, Carbon Credits serve as emissions balancing tools in the corporate and governmental sectors. These instruments, measured in tons of CO2 equivalent, function to offset greenhouse gas emissions. They provide a mechanism for companies or countries to financially support projects that reduce emissions elsewhere. In essence:

• Measured in tons of CO2 equivalent

• Represent reduced or avoided greenhouse gas emissions

• Allow companies or countries to offset their unfeasible or very costly carbon footprint

Spotting the Differences

While both I-RECs and Carbon Credits are on the same team, they play different positions. I-RECs are all about proving you're using renewable energy, while Carbon Credits are focused on balancing out your carbon footprint.

I-RECs drive demand for renewable energy sources, pushing for more wind turbines and solar panels to dot our landscapes. Carbon Credits, on the other hand, fund a variety of emission reduction projects, from reforestation to biochar carbon sequestration (CCS).

The Million-Dollar Questions

Now, you might be wondering, "Is it possible to use both?" Absolutely. Many companies use both as part of a comprehensive sustainability strategy.

As for which is better for your company, it will depend on your goals. If you're focusing on renewable energy use, I-RECs are your go-to. For overall emissions reduction (specially in hard to abate sectors), Carbon Credits might be more suitable.