Unitarian Universalist Congregation of the Upper Valley

What is a Green Tag?

A Green Tag is a new product that has been devised to help promote the generation of electricity from "green" sources -- solar, wind, geothermal, biomass, and small hydro -- instead of heavily-polluting fossil fuels and nuclear power.  A Green Tag is "created" whenever electricity is generated from a green source.  It represents the premium for the extra cost of green power.

How does it work?

Let us say that a new source of wind-generated electricity is to be supported by Green Tags and that each tag will represent one kilowatt-hour (kWh) of electricity generated.  The wind farm owner sells the electricity to a utility, but Tags representing that electricity are sold to another buyer who is interested in supporting renewable energy.  The key point to understand is that each Green Tag represents a certain  specified amount of electricity.  Green Tags can only be sold as long as they are "backed" by real, generated green electricity.

What is its value?

Typically, a utility wants to buy electricity from the cheapest source.  Often, this turns out to be coal or natural gas, both of which pollute the air and contribute to global warming.  (For every kilowatt-hour generated from coal, two pounds of carbon dioxide are emitted into the atmosphere; for every kilowatt-hour from gas, one pound of CO2 is emitted.)

Utilities are willing to buy electricity from green sources as long as they do not have to pay any more than for electricity from coal or gas.  At this time, though, green energy costs more to produce.  Thus, the Green Tag:  the wind farm owner sells the electricity to the utility at the going rate.  The Green Tag is then sold to a third party for the extra amount needed to cover the cost of generating green energy.

For example, let's assume that it costs the utility 3 cents to buy a kilowatt-hour of electricity generated by coal, but it costs the wind farm owner 4 cents to generate a kilowatt-hour from wind.  The wind farm owner sells the wind-generated electricity to the utility for 3 cents, and the Green Tag is sold to someone else for 1 cent plus an additional amount to make a profit.

In such a transaction, everyone is a winner:
 

• The utility is happy because it is buying electricity at the going rate, not having to spend extra for clean power.
• The wind farm owner is happy because he or she has made enough money from  the sale of the electricity and the Green Tag to cover costs and make a profit.
• The buyer of the Green Tag is happy because he or she has supported the generation of  electricity from renewable sources in two ways.  First, the energy being purchased has come from a new (since May, 1999) renewable  energy source that was brought on line in anticipation of the sale of these green power premiums.  Second, BEF, our Green Tag supplier, insures that all of the net revenues from Green Tags are invested in the next renewable energy project being developed.

You can help support green power by buying Green Tags.  If you buy Green Tags in an amount equal to your electricity consumption, then you are, in effect, "greening" your electricity supply.  The electricity system in the U.S. operates like a large pool of water -- customers draw electricity out and generators pump it in, but in the pool it is all mixed together and you cannot tell the difference.  When you buy Green Tags, you are paying for someone to add electricity from a green power source to the pool.  If everyone bought Green Tags to cover their electricity consumption, all of our electricity could eventually be generated by solar, wind, and other sources that do not pollute the air and water or contribute to global warming.

Where should I buy Green Tags?

The UUCUV Sustainability Action Group recommends the Bonneville Environmental Foundation (BEF), a not-for-profit organization organized specifically to sell  Green Tags to residential and small business users.  BEF certifies that the power is green and that the price represents a fair premium for the green power.  BEF has a board of directors that includes representatives of several other environmental organizations, including the Natural Resources Defense Council.  All net revenues from the sale of BEF Green tags are reinvested in the development of  new renewable energy projects.

You may purchase Green Tags directly from BEF; however, we strongly urge you to do so through the UUCUV Sustainability Action Group.  We are tracking responses to build a database to demonstrate the green energy demand in New Hampshire and Vermont.  In addition,  disseminating information on Green Tags  and tracking responses to the Green Tag project is an important part of the work we are doing to become one of the first recognized UU Green Sanctuaries in the country.  We do not receive any money for this work.

What is the price of a Green Tag?

The price varies from about 1.2 cents to 4 cents per kWh depending on the part of the country where the power is generated and a variety of local factors.  BEF is currently charging 2 cents per kWh in lots of 1000 kWh  This is a very reasonable price in today's market, and in addition any profit that BEF makes on the sale is used for environmental education and conservation projects.  If you choose the "Charitable Donation" option on your order form, your payment to BEF is tax deductible.  For more information you can view the FAQ at BEF's website at www.GreenTagsUSA.org or consult your professional tax advisor.

What should I do if I am still a little confused?

If you wish to speak with someone about Green Tags, please call the Unitarian Universalist Congregation of the Upper Valley at 802-649-8828, and your call will be directed to someone who can help you.