Understanding the Environmental Impacts of Electricity: Product Labeling and Certification

Abstract

Electricity consumers, including businesses and industries, are increasingly gaining the ability to choose among power options from either their current electric utilities or from alternative power providers. In order to help these consumers make informed decisions about their electricity purchases and to compare alternatives, many U.S. states are requiring electricity providers to disclose information regarding the fuel sources used to generate electricity and their associated environmental impacts. Like nutrition labels, environmental disclosure labels present the content or sources of electricity and are typically included with electricity bills and in product offers. These labels allow consumers to compare the environmental impacts of standard and cleaner power options, which are typically available.

In fact, more than one-third of electricity customers have access to green power—power generated from renewable sources such as solar, wind, hydro, geothermal, and biomass—directly through a power supplier. And green energy certificates, which represent the environmental attributes of renewable resources, are available nationally—even where the actual resource does not exist. Some products are certified by environmental organizations that verify the sources of power and ensure that environmental benefits are accrued. This article discusses clean, green power options available to power purchasers and the tools and information that can be used to make more sustainable power purchase decisions.