What are GRECs
To encourage a gradual transition to clean energy states like Maryland have set up a Renewable Energy Portfolio Standard, which requires energy companies to use a specific percentage of renewable energy credits yearly or pay a fee. At least some must come from solar and wind, but there was no previous carve-out for geothermal energy.
For every 1,000 kilowatt-hours or 1 megawatt-hour your system generates, you are credited with 1 GREC.
Carbon Solutions tracks your system’s geothermal generation in a process called aggregation. These aggregated RECs are put on the marketplace for utilities to purchase.
What is the Value of a GREC
RECs generated from geothermal energy systems are valued differently than those generated from solar energy systems, and vary over time with demand. For example, as of June 2023, the average value of a Maryland-generated geothermal REC was $29.50, and the average value of a Maryland-generated solar REC is $59.00. The average geothermal system generates 40 RECs a year, while the average solar energy system generates 15 RECs per year.
How Does a GHC System Work
Geothermal Heating and Cooling Systems (GHCs) utilize the constant temperature underground to warm and cool a home or building. At the heart of a GHC system is a heat pump that operates in two modes: heating and cooling.
Geothermal heat pumps use a heat exchange liquid inside a piping system to release or absorb heat from the ground. This type of setup takes advantage of year-round ground temperatures. In heating mode, the system absorbs heat from the ground. In cooling mode, the system releases heat to the ground.
In most parts of the United States, the air temperature can fluctuate over 100°F from summer to winter. In contrast, the ground temperature in the first 10 feet fluctuates between 45°F and 75°F. A GHC system doesn’t generate heat; it simply collects it and moves it to an area where it can be used, like inside a home or business.
Geothermal systems use this difference in temperature to transfer heat between your home and the earth. The heat pump and circulating fluid continuously transfer heat. In summer, the geothermal system draws heat from the air in your home and transfers it to the ground. During winter, it draws heat from the ground and transfers it to your home.
Benefits of Geothermal Energy (US Department of Energy)
Renewable—The heat flowing from Earth’s interior is continually replenished by the decay of naturally occurring radioactive elements and will remain available for billions of years.
Baseload—Geothermal power plants produce electricity consistently and can run essentially 24 hours per day/7 days per week, regardless of weather conditions.
Domestic—U.S. geothermal resources can be harnessed for power production and heating and cooling without importing fuel.
Small footprint—Geothermal power plants and geothermal heat pumps are compact. Geothermal power plants use less land per gigawatt-hour (404 m2) than comparable-capacity coal (3,642 m2), wind (1,335 m2), and solar photovoltaic (PV) power stations (3,237 m2)*. GHPs can be retrofitted or integrated into new buildings.
Clean—Modern geothermal power plants emit no greenhouse gasses and have life cycle emissions six to 20 times lower than natural gas. Geothermal power plants consume less water on average over the lifetime energy output than most conventional electricity-generation technologies.
Numbers from the US Environmental Protection Agency (EPA) show that homeowners using geothermal systems may realize savings of 30-70% on heating costs and 20-50% on cooling costs compared to conventional systems. That can translate to savings of $1,500 annually.
Here is an example of residential savings. (Climate Master Geothermal Calculator)
Home Type (New/Existing): Existing
Conditioned Space: 2000 sq. ft.
Insulation and Air Leakage: Average
HVAC Equipment: 3 - 15 years old
HVAC Equipment Efficiency: Standard
Heating Type: Natural Gas
Water Heating Type: Natural Gas