Market Advisory: Oregon House Bill 2021 and Green-e® Standard Change
Center for Resource Solutions, which runs the Green-e® Energy certification program, is sending this notice to regional stakeholders and all Green-e® program participants to notify them of changes to the Green-e® Renewable Energy Standard for Canada and the United States (Standard), effective immediately, resulting from a recent decision by the Oregon Public Utility Commission (PUC).
Background
In 2021, Oregon passed the Oregon Clean Energy Targets Bill (HB 2021), which requires retail electricity providers to meet targets to reduce greenhouse gas (GHG) emissions associated with the electricity sold to retail electricity consumers as reported to the Oregon Department of Environmental Quality (DEQ).
During 2022 and 2023, the Oregon PUC held proceedings addressing implementation of HB 2021. CRS engaged in these proceedings as a public stakeholder in Docket No. UM 2225 and an interested person in Docket No. UM 2273. CRS provided input on the potential for, effect of, and solutions to avoid double counting and the law’s effects on regional wholesale power markets, programs in other states, and voluntary markets. CRS’s comments in these dockets are publicly available at UM 2225 and UM 2273.
Oregon PUC Order No. 24-002
On January 5, 2024, the Oregon PUC issued Order No. 24-002 in a proceeding entitled “Investigation Into House Bill 2021 Implementation Issues,” concerning a bill that became law in 2021. The Oregon PUC’s order confirms that renewable energy certificates (RECs) associated with electricity procured by entities for compliance with HB 2021 are not surplus to regulation and these entities must disclose when selling off those RECs that the generation is still reported as emissions-free to Oregon’s Department of Environmental Quality (DEQ).
The PUC did not make a determination about whether HB 2021 compliance reduces the emissions associated with electricity delivered to retail consumers in Oregon and thus whether it constitutes a claim for Oregon retail consumers regarding the emissions associated with the electricity they use. As a result, the emissions attributes of renewable energy used for HB 2021 compliance are likely to be claimed for Oregon customers and there may be disaggregation of the REC or double counting of the emissions attribute if the RECs associated with generation reported to DEQ are sold to voluntary renewable energy customers or used for other programs in other states.
While the emission reduction target dates in the law are 2030, 2035, and 2040, the PUC clarifies in the Order that the basis for compliance is annual emissions reporting to the DEQ.
The Oregon PUC Order is available at https://apps.puc.state.or.us/orders/2024ords/24-002.pdf (pp. 5–17).
Resulting Changes to the Green-e® Renewable Energy Standard for Canada and the United States
Under the Standard, Green-e® Energy certified renewable energy products cannot be used toward compliance with state renewable energy, carbon, or other climate mandates (See Standard, Section III.D).
As a result of the Oregon PUC’s order, CRS has updated the Standard with the following language in Appendix A: State-Specific Requirements and Restrictions, Section A.10, effective immediately:
Starting with Jan 1, 2024 generation, RECs associated with generation reported to the Oregon DEQ for compliance with Oregon HB2021 are not eligible for use in a Green-e® certified renewable energy product.
For the sake of clarity, this policy also applies to generation located outside of Oregon and products sold to customers outside of Oregon. For example, if a utility bought bundled renewable electricity from Washington state and reported that electricity to the Oregon DEQ for compliance with HB2021, the associated Washington RECs would not be eligible under the Green-e® Standard.
This rule applies to such RECs even if the generation facility is located outside of Oregon and/or the product is sold to customers outside of Oregon.
RECs associated with generation on or after January 1, 2024 that are reported to the Oregon DEQ for compliance with HB2021 may not be used in a Green-e® certified renewable energy product. This affects generation from the first quarter of 2024 that might otherwise have been eligible for use toward verification of 2023 sales based on the vintage requirements in the Standard.
Contact
For more information, please contact CRS’s Green-e® program staff at comments@green-e.org.