Renewable Thermal Certificates (RTC)
RTC Credit Supply Solutions
The Renewable Thermal Certificates (RTC) system is an environmental credit program that incentivizes the adoption of renewable thermal energy sources in sectors with high thermal energy demands, such as manufacturing, agriculture, and building operations. Established to support sustainability and greenhouse gas (GHG) reduction efforts, the RTC program encourages facilities to reduce reliance on fossil fuels for heating and cooling applications. It is particularly useful for emissions-intensive and trade-exposed (EITE) industries that seek a balance between energy efficiency and competitive costs.
At Targray, we offer expert guidance for businesses navigating the RTC market. Our Environmental Commodities team provides tailored solutions to help participants maximize RTC credit opportunities and comply with renewable energy regulations. Contact us to explore innovative strategies that can help your organization benefit from the RTC system while supporting climate goals.
A Renewable Thermal Certificate is an environmental credit generated by facilities that use renewable thermal energy sources for heating and cooling applications, such as biomass, solar thermal, and geothermal. As industries and governments around the globe strive for net-zero emissions, RTCs have emerged as a powerful tool to incentivize renewable energy use and support sustainable practices.
Why Renewable Thermal Energy Matters
In sectors such as manufacturing, agriculture, and real estate, thermal energy accounts for a large portion of total energy consumption. Unlike renewable electricity, which has gained substantial traction, renewable thermal energy is less commonly adopted but represents a significant opportunity for reducing greenhouse gas (GHG) emissions. By replacing fossil fuel-based thermal sources, RTCs contribute to a cleaner, more sustainable future.
How Renewable Thermal Certificates Work
RTCs are awarded to facilities that switch to renewable thermal technologies, providing a measurable credit for each unit of renewable heat generated. These credits not only serve as a recognition of reduced carbon emissions but also create an economic benefit. Facilities with surplus RTCs—those that exceed the minimum standard for renewable thermal use—can sell or trade their credits in regulated markets, providing a financial incentive for both early adopters and existing renewable energy users.
Compliance and Voluntary RTC Markets
RTCs operate in both compliance and voluntary markets, enabling a broad range of organizations to participate. Compliance markets, driven by government mandates, require facilities in regulated sectors to meet specific renewable energy standards. In contrast, voluntary markets attract companies motivated by corporate sustainability goals and public demand for environmental responsibility.
RTC’s Role in Achieving Net-Zero Emissions
As industries transition to cleaner energy, RTCs play an essential role in advancing net-zero goals. Renewable thermal energy can drastically reduce emissions in sectors that cannot easily electrify their heating or cooling needs. By supporting these efforts, RTCs ensure that more organizations can adopt renewable practices while maintaining efficiency and cost-effectiveness.
RTCs are generated by using verified renewable thermal technologies to produce heat, cooling, or hot water for industrial and commercial applications. Facilities earn credits for every unit of renewable thermal energy produced, which is then validated by an official RTC registry. By meeting or exceeding performance standards, facilities can accumulate RTCs and use them to offset emissions or sell them in the RTC market for a profit.
Strategies for Maximizing RTC Generation
- Invest in Efficient Renewable Technologies: Selecting the right combination of renewable technologies, such as biomass boilers or geothermal systems, allows facilities to produce thermal energy more sustainably and efficiently.
- Optimize Existing Operations: Facilities can enhance their RTC generation by integrating renewable thermal solutions into existing processes, achieving greater thermal output with minimal investment.
- Upgrade with Sustainable Infrastructure: Transitioning from traditional fossil-fuel-based heating and cooling systems to renewable ones can yield substantial RTCs, especially in sectors with high thermal demand.
Monetizing RTCs Through Trading and Compliance Programs
The RTC market offers flexibility for businesses. Facilities can use RTCs to comply with government-mandated renewable energy targets, reducing the risk of penalties and positioning them as leaders in sustainability. In addition, companies with surplus RTCs can monetize them in compliance or voluntary markets, generating additional revenue to reinvest in further sustainability initiatives.
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GREEN-E® CERTIFICATIONTargray is a registered participant in the Green-e Energy renewable energy certification program. Green-e carbon products and solutions undergo a through investigation process ensuring they are sourced from a eligible energy sources (e.g. – wind, solar, geothermal, biomass or low-impact hydropower) that meet international standard criteria. |
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The Verra RegistryVerra is a global leader helping tackle the world’s environmental and social challenges by developing and managing standards that help the private sector, countries, and civil society achieve ambitious sustainable development and climate action goals. The standards and programs Verra develops and manages are globally applicable and advance action across a wide range of sectors and activities. Programs undergo extensive stakeholder consultation and expert review, and draw from four key components: standard, independent assessment, accounting methodologies, and registry. |
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Gold StandardThe Gold Standard (GS) is a voluntary carbon offset program focused on progressing the United Nation’s Sustainable Development Goals and ensuring that project’s benefit their communities. It can be applied to voluntary offset and Clean Development Mechanism (CDM) projects. The GS CDM was launched in 2003 after a two-year consultation with stakeholders, governments, non-governmental organizations, and private sector specialists from over 40 countries. The GS for voluntary offset projects was launched in 2006. The GS project registry – containing all projects implemented through the standard was launched in 2018. |
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American Carbon Registry (ACR)The American Carbon Registry (ACR), a nonprofit enterprise of Winrock International, was founded in 1996 as the first private voluntary greenhouse gas registry in the world. Winrock operates ACR to create confidence in the environmental and scientific integrity of carbon offsets in order to accelerate transformational emission reduction actions. |
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Climate Action Reserve (CAR)The Climate Action Reserve (CAR) is an offset registry for global carbon markets. CAR establishes high quality standards for carbon offset projects, oversees independent third-party verification bodies, issues carbon credits generated from such projects and tracks the transaction of credits over time in a transparent, publicly-accessible system. |
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International Emissions Trading Association (IETA)The International Emissions Trading Association (IETA) is a non-profit association with more than 250 members who are active stakeholders in the international carbon and emissions markets. The organization was created in 1999 to establish a global framework for greenhouse gas emission reductions trading. |
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INTERNATIONAL SUSTAINABILITY & CARBON CERTIFICATION (ISCC)ISCC is a globally applicable sustainability certification system that covers all sustainable feedstocks, including agricultural and forestry biomass, circular and bio-based materials and renewables. |
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Xpansiv CBLCBL has established the first of its kind Standard Instruments Program (SIP) to build on market infrastructure to accompany and govern the launch of spot contracts for the settlement and physical delivery of environmental commodities across existing registries that can be determined as meeting certain defined, standardized criteria for market quality and performance. |
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