S&P Global Market Intelligence Launches Renewable Energy Credit Pricing Forecasts

Rhea-AI Summary

S&P Global Market Intelligence has launched a new Renewable Energy Credit (REC) Price Forecast dataset within its Power Forecast series. This tool will aid market participants in assessing wholesale renewable electricity values in the U.S., supporting companies in achieving 100% renewable energy mandates. Despite current strong REC pricing in New England, projections indicate potential declines due to favorable wholesale power economics and expanding offshore wind contributions. The dataset enhances insights into environmental compliance costs and regulatory impacts, benefiting energy market investors.

Positive

• Launch of REC Price Forecast supports market analysis for renewable energy.
• Helps organizations meet increasing green energy mandates.
• Provides insights into potential revenue streams from renewable energy.
• Enhances investment decision-making in the energy transition.

Negative

• Projected decline in REC prices due to favorable economics and offshore wind contributions.

NEW YORK, Feb. 1, 2021 /PRNewswire/ -- S&P Global Market Intelligence today introduces its Renewable Energy Credit (REC) Price Forecast dataset as part of its Power Forecast series. This new dataset enables market participants to analyze and assess the value of wholesale renewable electricity in the U.S.

Renewable Energy Credits are often used to offset carbon emissions of a company or as a way for organizations to reach 100% renewable sources. S&P Global Market Intelligence's new REC price forecast will provide insight into new revenue streams for energy facilities that are looking to be compensated for the value of their renewable energy.

"As global energy markets continue to shift their reliance on fossil fuels to alternative sources, organizations may look to RECs to help comply with increasing green energy mandates," said Steve Piper, Research Director for Energy at S&P Global Market Intelligence. "With more RECs are being purchased, the demand and production of renewable energy increases. This new pricing forecast will provide differentiated insights into the value of renewable energy and give investors participating in this market the ability to forecast the green premium for energy transition, helping them make informed-decisions."

While REC pricing today is currently strong across several New England states, developer interest in the region has grown as have commitments to offshore wind in multiple states. S&P Global Market Intelligence projects that increasingly favorable wholesale power economics and expanding contributions from offshore wind may pressure New England REC prices lower in the years ahead.

A REC is created for every one-megawatt hour (MWh) of electricity generated and delivered it to the grid. The green benefits of generating electricity using renewable sources can then be sold to other entities via RECs on the open market. RECs are often used to offset carbon emissions of a company and as a path to achieving 100% renewable electricity use.

This newly introduced S&P Global Market Intelligence forecast complements the Market Intelligence platform's current REC index prices providing information on unbundled RECs, and the current price of these instruments. The REC Pricing Forecast will also allow market participants to:

• Estimate environmental compliance costs to utilities that rely heavily on fossil fuels;
• Identify which market each green asset sells into and tie that identification to a REC projection;
• Project financial impacts of regulatory changes and renewable power generation mandates.

For more information about S&P Global Market Intelligence's Power Forecast insights, please visit here.

About S&P Global Market Intelligence
At S&P Global Market Intelligence, we understand the importance of accurate, deep and insightful information. We integrate financial and industry data, research and news into tools that help track performance, generate alpha, identify investment ideas, perform valuations and assess credit risk. Investment professionals, government agencies, corporations and universities around the world use this essential intelligence to make business and financial decisions with conviction.

S&P Global Market Intelligence is a division of S&P Global (NYSE: SPGI), the world's foremost provider of credit ratings, benchmarks and analytics in the global capital and commodity markets, offering ESG solutions, deep data and insights on critical business factors. S&P Global has been providing essential intelligence that unlocks opportunity, fosters growth and accelerates progress for more than 160 years. For more information, visit www.spglobal.com/marketintelligence.

Media Contact
Amanda Oey
S&P Global Market Intelligence
+1 212-438-1904
amanda.oey@spglobal.com 

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SOURCE S&P Global Market Intelligence

FAQ

What is the new REC Price Forecast launched by S&P Global Market Intelligence?

The REC Price Forecast dataset provides analysis on the value of wholesale renewable electricity in the U.S., allowing market participants to assess renewable energy credits.

How will the REC Price Forecast impact investors in the energy market?

The forecast will help investors make informed decisions by projecting the green premium for energy transition and estimating compliance costs.

When was the REC Price Forecast dataset introduced by S&P Global?

The dataset was introduced on February 1, 2021.

What are the future expectations for REC prices in New England according to S&P Global?

S&P Global projects that REC prices may decline in the future due to favorable wholesale power economics and contributions from offshore wind.

What is the significance of Renewable Energy Credits (RECs)?

RECs are used to offset carbon emissions and help organizations reach renewable energy goals, with one REC representing one megawatt-hour of renewable electricity.