Renewable Energy Certificates Market Size to Reach USD 186.5 Billion by 2032 growing at 28.0% CAGR - Exclusive Report by Acumen Research and Consulting

Author: Acumen Research and Consulting

The Renewable Energy Certificates Market, valued at USD 20.5 Billion in 2023, is anticipated to surpass USD 186.5 Billion by 2032, reflecting a projected CAGR of 28.0%

The demand for renewable energy certificates (RECs) has surged in recent years as more organizations strive to meet sustainability goals and shrink their carbon footprint. According to the National Renewable Energy Laboratory, the US REC market grew from approximately 10 million MWh in 2010 to over 170 million MWh in 2020. This growth can be attributed to a variety of factors, including increasing renewable energy capacity and declining costs, increased corporate sustainability commitments, and government policies supporting renewable energy development.

Renewable energy certificates (RECs) are a tradable commodity that represents proof that one megawatt-hour (MWh) of electricity was generated from a renewable energy source. Essentially, RECs allow individuals, organizations, and governments to support renewable energy without physically purchasing or installing renewable energy infrastructure. Instead, RECs function as a market-based solution for promoting renewable energy development and mitigating carbon emissions. The growth of the REC market has also led to the development of innovative financing structures, such as virtual power purchase agreements (VPPAs), which allow organizations to directly support the development of new renewable energy projects by purchasing RECs from specific projects. This has led to a significant increase in the number of large-scale renewable energy projects being developed, particularly in the corporate sector.

Renewable Energy Certificates Market Revenue

Renewable Energy Certificates Market Statistics

  • The global renewable energy certificates market reached USD 20.5 billion in 2023, with an expected 28.0% CAGR from 2024 to 2032
  • North America accounted for approximately 42% of the market share in 2023, while
  • Europe is forecasted to grow at a CAGR of over 29% from 2024 to 2032
  • India's Ministry of New and Renewable Energy reported a total installed renewable energy capacity of 98.5 GW as of February 2023, representing about 28% of the country's total installed power capacity
  • The increasing emphasis on carbon neutrality and corporate sustainability initiatives is a key driver propelling the revenue growth of the renewable energy certificates market.

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Renewable Energy Certificates Market Dynamics

Increasing Demand for Green and Sustainable Products and Services Offers Significant Renewable Energy Certificates Market Opportunity

The growing demand for environmentally friendly products and services creates a substantial opportunity for the renewable energy certificates (REC) sector. As global environmental consciousness rises, consumers, businesses, and governments prioritize sustainability in their purchase decisions. This transition to green and sustainable behaviors has increased demand for renewable energy sources such as solar, wind, hydropower, and biomass energy. For the REC market, this development means that an increasing number of businesses and organizations are purchasing RECs to demonstrate their commitment to sustainability. Businesses who purchase RECs can claim to have offset their carbon footprint and supported renewable energy generation, even if they are unable to physically participate in the infrastructure. This enables businesses to connect their operations with sustainability goals, improve their brand image, and attract environmentally concerned customers.

Likewise, government rules and programs targeted at decreasing carbon emissions and supporting renewable energy increase the demand for RECs. Many governments provide incentives and subsidies to stimulate the use of renewable energy, encouraging firms to invest in RECs to meet regulatory obligations and exhibit environmental stewardship. In addition, the increase of corporate sustainability efforts and environmental certifications, such as LEED (Leadership in Energy and Environmental Design), B Corp certification, and carbon neutrality commitments, encourages businesses to buy RECs to meet their sustainability goals. As a result, the REC market sees higher demand, which drives investment in renewable energy projects and contributes to the transition to a more sustainable energy future.

Renewable Energy Certificates Market Trends

The renewable energy certificate (REC) market is undergoing rapid evolution, driven by several key trends shaping the future of renewable energy. Large corporations are increasingly demanding renewable energy to meet ambitious sustainability targets. Purchasing RECs has become a popular strategy for achieving these goals, spurring a surge in demand and investment in renewable energy projects. Another significant trend is the emergence of new types of certificates, such as carbon offsets and green bonds. Carbon offsets allow companies to offset emissions by investing in emission-reducing projects, while green bonds raise funds for renewable energy projects, contributing to REC generation and market innovation.

Moreover, emerging technologies like blockchain, AI, and machine learning are revolutionizing REC trading and tracking. Blockchain ensures transparency and security in trading platforms, fostering trust among participants. AI and machine learning analyze energy data to empower buyers with informed decision-making capabilities. These trends collectively drive growth and innovation in the REC market, shaping a more sustainable future powered by renewable energy.

Renewable Energy Certificates Market Segmentation

The global market for REC market has been segmented into energy type, end-use, and region.

  • Energy type segmentation includes solar energy, hydro-electric power, wind power, and gas power.
  • End-use categorization comprises voluntary and compliance sectors.
  • Regional classification encompasses Asia-Pacific, North America, Europe, Latin America, and the Middle East and Africa (MEA).

Renewable Energy Certificates Market Regional Outlook

In Europe, the renewable energy certificates industry is booming because of several reasons that make it a great place for investors and buyers. One big reason is that European governments and institutions are really committed to using renewable energy and being sustainable. The European Union even set a goal to have 32% of its energy come from renewable by 2030. Many countries are giving incentives and making policies to help renewable energy grow. Another reason for Europe's growth in this industry is that lots of companies want to use renewable energy to meet their sustainability goals. They're buying renewable energy certificates (RECs) to help with this. Because of this demand, more and more money is being invested in renewable energy projects.

Renewable Energy Certificates Market Players

Renewable energy certificates companies profiled in the report include 3Degrees Group, Inc., Renewable Choice Energy, 3 Phases Energy Services, ECOHZ, First Environment, Inc., Schneider Electric SE, Enel Green Power, NextEra Energy Resources, LLC, NRG Energy, Inc., Dominion Energy Solutions, Green-e Energy, and NativeEnergy.

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Mr. Frank Wilson

Acumen Research and Consulting

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