We have reviewed the administrative clarification credit ruling regarding Renewable Energy Credits (RECs) and dated 5/16/2006. It discusses two items: 1. the sale of RECs, valuation of on-site renewable energy generation, and 2. separate ownership of the building and the on-site system. Please confirm that item 2 only applies if item 1 applies. For example: if the renewable system owner retains the REC associated with the power it produces and does not sell or trade the REC then: 1. an on-site renewable energy system may be owned and operated by an entity other than the building owner, and 2. the system does not need to meet the three qualifiers listed at the end of the REC ruling dated 5/16/2006, and 3. the building owner can still receive EA-c1 points, and 4. the building owner can still receive EA-c2 points. In our case, the renewable energy system owner is the local utility. The building owner is committed to long-term on-site renewable energy generation through an agreement with the utility. We believe this situation clearly meets the intent of the credit: to increase the level of on-site renewable energy supply.
Each topic addressed in the CIR ruling dated 5/16/2006 (sale of RECs vs. ownership of the on-site system) is an independent ruling that stands alone. Thus, in the applicant\'s situation, the project needs to demonstrate the following: 1. There is a minimum 10-year contract with the local utility to purchase energy generated by the proposed system. 2. There must be clear documentation for accounting purposes whether the purchase includes the RECs or just the energy output. 3. If the purchase does not include the RECs, the building owner or energy system owner must make the 200% offset REC purchase described in the first portion of the CIR for at least 10 years. The project will be eligible to achieve points under EAc2 and take credit for the system under EAc1, as long as the project can comply with the three points outlined above, and provided that the system meets the requirements of on-site renewable energy sources as per EAc2 administrative CIR ruling dated 7/7/2006. Applicable Internationally.