Decarbonising Electricity Consumption with EACs

This article will discuss what unbundled EACs are, which energy markets they are available in and how they can support in reducing emissions.
The purchasing of unbundled Energy Attribute Certificates (EACs) is becoming an increasingly popular approach for companies to reduce electricity (scope 2) emissions. These certificates are available in almost every electricity market, making them an attractive decarbonisation method for companies that operate in regulated electricity markets, or in markets where a direct renewable electricity supply is not available (in order to achieve decarbonisation targets).
This article will discuss what unbundled EACs are, which energy markets they are available in and how they can support in reducing emissions.
What are 'Unbundled' EACs?
Energy Attribute Certificates, commonly known as EACs, are contractual instruments that showcase the origin, ownership, vintage (year) and technology of renewable electricity generation. Each individual certificate represents 1 MWh of renewable electricity generated.
There are two approaches to procuring EACs, this can either be 'bundled' EACs or 'unbundled' EACs.
- Bundled EACs are EACs that are provided within a renewable electricity supply contract (where a premium is paid for the inclusion of EACs to cover electricity consumption).
- Unbundled EACs are EACs that are purchased from a third party, independent to an electricity supply contract.
Companies purchasing EACs (bundled or unbundled) can report zero emissions for all electricity consumption (MWh) covered by EACs for annual sustainability reporting purposes and showcasing decarbonisation.
EAC Types for Different Markets
EACs are available in various parts of the world where they are required to meet national/multinational standards (which align with the requirements of the GHG Protocol). EACs can be purchased in the following markets:
- Guarantees of Origin (GOs) in Europe
- Renewable Energy Guarantees of Origin (REGOs) in the United Kingdom
- Renewable Energy Certificates (RECs) in the USA and Canada
- International Renewable Energy Certificates (I-RECs) in a number of countries in Asia, Africa, the Middle East and Latin America
- Renewable Energy Target Certificates in Australia
- Green Power Certificates in Japan
- zaRECs in South Africa
How do EACs Support Reporting a Reduction in Scope 2 Emissions?
EACs are a well-established method of enabling companies to report a reduction in scope 2 emissions on a market-based reporting perspective. There are two methods in measuring and reporting greenhouse gas emissions:
- Location-based reporting method – Emissions are calculated using the emissions intensity of the local grid area where the electricity usage occurs. This method does not factor in renewable supply contracts or EACs and uses the local grid average emission factor.
- Market-based reporting method – Emissions are calculated based on the electricity that organisations have chosen to purchase, using supplier-specific emission factors or the purchasing of EACs (bundled or unbundled).
Companies are generally required to report under the location-based approach, however, it is recommended to also report under the market-based method to showcase carbon reduction efforts achieved through renewable supply contracts or EACs.
The reporting company must ensure that the EACs can be retired in the reporting company's name in order to be able to claim a reduction in carbon emissions on a market-based reporting perspective. A company can purchase EACs to cover their total consumption in order to report zero scope 2 emissions on a market-based reporting perspective.
Why Purchase Unbundled EACs?
1. Secure Cost Advantages
Unbundled EACs can have a cost advantage to bundled EACs as they can be sourced from multiple providers, whereas bundled EAC costs are determined by the supplier. This increase in choice also enables the buyer to select between type and vintage of renewable technologies, which is crucial when aligning to international leading standards such as RE100 and CDP.
2. Tackle Regulated Energy Markets
As unbundled EACs are available in almost all electricity markets, they are an attractive decarbonisation measure where direct renewable supply contracts are not available, particularly in markets that are regulated (including states in the USA, China, India etc). This has made the procurement of unbundled EACs a more popular approach for companies seeking to decarbonise global portfolios.
3. Achieve Immediate Impact
Unbundled EACs can be purchased for required reporting periods in a straightforward and timely manner in order to showcase a reduction in electricity emissions. Many companies use EACs as a short- to medium-term solution while developing other strategic was to decarbonise electricity consumption, including energy efficiency, on-site generation (solar PV) and Power Purchase Agreements (PPAs).
How NUS can Help
NUS work with a range of specialist partners in order to support companies with the direct purchasing of unbundled EACs. EACs can be purchased to align with various international standards such as the SBTi, RE100 and CDP. The NUS Energy and Sustainability Services (ESS) team can guide your through the entire process, from identifying suitable EACs for each site/market, to the procurement of EACs for global sustainability reporting requirements. If you are interested in purchasing unbundled EACs or would like to find out more please contact us online.
