Marin Clean Energy’s Deep Green – the BIG Lie

Marin Clean Energy advertises that its Deep Green energy does something BIG about global warming. Indeed. It is an unfortunate truth because Deep Green does do something BIG: It increases global warming. Here’s why:

Most of MCE’s Deep Green energy (and about half of Light Green renewable) is based on a paper shuffling scheme, known as a Renewable Energy Certificate (REC). Each REC is produced by a renewable energy resource, such as a wind farm in Washington. One REC represents one megawatt-hour (MWh) of energy from the wind farm. In the case of MCE, Washington keeps the wind energy and MCE buys its inexpensive RECs, giving MCE the right to tell everyone it is the one that’s green – not the wind farm (there is a formal accounting system in the Western U.S. that tracks these transactions). 

But since MCE still needs to deliver actual electricity to its Marin customers, it purchases cheap gas-fired power, and then reports the REC to governing agencies... and voila – instantly “clean” gas-fired energy! And it’s all perfectly legal. Legal, yes. But not particularly ethical or responsible to MCE customers, some of whom, thanks to MCE’s misleading advertising, believe they get “green electricity” through their light sockets. 

Worse still, by using RECs, something bad and BIG has indeed changed – greenhouse gas (GHG) emissions are not decreasing as MCE claims, but are actually increasing because MCE is adding to the demand for gas-fired power plants. The more RECs it buys, the more demand it puts on gas-fired power – and the more emissions it produces. RECs are stoking fossil-fired power while MCE tells everyone that Deep Green is saving the planet. See attachment.

To the layperson MCE’s 2012 power content label discloses nothing about what’s actually behind its RECs – massive amounts of California’s brown system energy.  The label shows “Total Green-e Energy Certified New Renewables” which is a euphemism for the fossil-energy. The Sierra Club identifies the use of Green-e certificates as deceptive marketing (note 1). 

The inherent fallacy of RECs is that they don’t clean anything. And at about $2.50 each REC may “support” development of renewables, but a 2 percent bump in a wind farm’s income stream isn’t enough to stimulate development of new renewable projects (note 2).     

The real winner in the REC scheme is the region around that Washington wind farm. That region gets the truly clean energy from the “steel-in-ground” local wind farm, and Washington isn’t emitting GHGs like MCE’s version of clean energy does. Washington also keeps what’s left of Marin's money after paying sales commissions to the REC brokers. 

So much for the clean energy benefits of Deep Green.

Ironically, the cleanest way for MCE to help the environment is stop selling Deep Green and deliver actual renewable energy to all ratepayers.  MCE should do this without charging its Deep Green customers any premium, as originally promised before launching into business. This will cut into MCE’s 80 percent sales margin from its Deep Green gas-fired model, but it eliminates shell games (note 3). 

MCE appeared one day claiming it was a better version of PG&E. After public pressure from the Sierra Club and other groups, PG&E recently killed its version of Deep Green. Now it’s time for MCE to do the same (note 1 and 4).    

Note 1:

 “The Green-e certification provides no assurance that the utility has purchased or would generate any renewable energy or otherwise “green up” the power supply.  This is deceptive marketing.”  Source: The Sierra Club protest of PG&E’s originally proposed REC-based Green Option at CPUC, dated May 24, 2012, page 7.

Note 2:

M. Mendonca et al., Powering the Green Economy (earthscan 2010) at p.160 (Powering the Green Economy).

Note 3:

MCE’s 80 percent margin determined as follows: 

Deep Green margin = your Deep Green price / (MCE’s cost of gas-fired energy + cost of REC). 

MCE margin ($) = $0.084* / [$0.0449** per kilowatt-hour + $0.002*** per kilowatt-hour]

MCE margin (%) = +80% margin per kilowatt-hour Deep Green energy sales.

* MCE Deep Green residential price, effective July 1, 2013.

** MCE system energy price (predominantly gas-fired) from Shell Energy North America contract Confirmation, Amended & Revised October 10, 2012, Exhibit 2 = $44.90 per megawatt-hour.

*** Middle Fork Irrigation District REC price = $2.00.  Single REC covers 1 megawatt-hour.  Therefore, MCE cost per kilowatt-hour = $0.002.  Contract executed with Middle Fork by MEA (MCE) Chair Damon Connolly on April 5, 2012 and MCE Executive Officer Dawn Weisz on April 6, 2012.

Note 4:

“The Green Option tariff proposed by PG&E very closely mirrors the Deep

Green product offered by MEA.”  Source:  MEA protest of PG&E’s originally proposed REC-based Green Option at CPUC, dated May 25, 2012, page 1.