Preface: LEED CS v3.0 Project in Massachusetts.

Our project is designed to produce 16% on-site renewable energy. The energy is fed directly into the building and used by the building. The system is located fully within the project boundary. However, the State awards the owner 1 REC per 1,000 kWh produced on site as an incentive. Questions are below:

1) Can our project count all 16% on-site energy production toward our LEED credits under EAp2/c1/c2?

2) If the above answer is NO, we will need to buy RECs. Do we need to buy a REC for 1% of the anticipated project energy cost to get 4 points, OR do we need to buy a REC for all 16% that's produced on site? The language in the LEED template leads me to believe that we are expected to repurchase all 16% as new RECs, which seems completely counter-intuitive from a financial standpoint.