When enterprises embrace sustainability and cleaner energy already famous terms such as GOs and RECs are being widely used. They are both key in supporting the evidential tor for renewable energy consumption as well as for achieving net-zero. But then, how do you determine which one of the two best fits your needs? Both systems will describe how they work, as well as explaining how they can be effective in helping your organization to meet renewable energy objectives.
What Are Renewable Energy Certificates (RECs)?
The industry uses the Renewable Energy Certificates (RECs) in the United States to ensure that a given amount of electricity comes from renewable resources. One REC is issued for every one MWh of electricity generated from renewable energy technologies such as wind, sun or water.
The unique aspect of RECs is that they can be:
- Bundled: Sold with the physical electricity produced.
- Unbundled: Sold separately from the power itself.
Despite the fact that RECs may provide claims of renewable energy usage to businesses, the actual power used by those companies may be sourced from different kinds of energy on the grid. Once the ‘retired’ RECs are bought, the ability is taken away from somebody else to use those RECs to claim that a business entity requires renewable energy, or it has met its RE100 or CDP (Carbon Disclosure Project) target.
What Are Guarantees of Origin (GOs)?
Across the Atlantic, Guarantees of Origin (Go’s) play the same role although they exist in the European Union only. RECs are Procurement of Electricity Certificates that attests that electricity is renewable. Also referred to as guarantees of origin, each GO is introduced under the EU Renewable Energy Directive and is equivalent to 1MWh of renewable energy fed into the grid.
One characteristic of GOs is trans-border trade. This means companies are able to buy the certificates of renewable energy sources from renewable sources in different European countries in line with their energy needs. Similarly to RECs, retiring GOs allows organizations to say that they procure 100% renewable energy.
For businesses that are based in Europe, GOs are crucial for the implementation of CSRD and other programs such as CDP and RE100.
Key Differences: RECs vs. GOs
While both RECs and GOs achieve the same goal of certifying renewable energy usage, their differences lie in geography and specific market applications:
| Feature | RECs | GOs |
| Region | United States | Europe |
| Certification Body | Market-Based Providers | EU Renewable Energy Directive |
| Tradability | Limited to U.S. markets | Cross-border trade within Europe |
| Usage | Voluntary schemes like CDP, RE100 | CDP, RE100, CSRD compliance |
| Flexibility | Bundled or Unbundled purchases | Often traded unbundled across grids |
If a firm is an international firm it may end up having to deal with both systems, RECs where operative in the U.S and GOs for Europe.
Which One Is Right for You?
The choice between Guarantees of Origin (GOs) and Renewable Energy Certificates (RECs) depends largely on your geographical footprint and reporting obligations.
- If Your Business Operates in the U.S.: RECs are the go-to option for proving renewable energy consumption. They are widely accepted in voluntary reporting schemes like RE100 and CDP.
- If Your Operations Are in Europe: GOs are mandatory for reporting under European sustainability frameworks like CSRD. They also offer the added benefit of cross-border trade, allowing flexibility in sourcing renewable energy certificates.
- For Global Companies: Businesses with multinational operations often use a combination of RECs, GOs, and other Energy Attribute Certificates (EACs) like I-RECs (used in Asia, Africa, and Latin America) to meet global renewable energy claims.
How to Manage RECs and GOs Effectively?
Managing RECs and GOs can become complex, especially for organizations with a large global footprint. Tracking consumption data, retiring certificates, and ensuring compliance with frameworks like CDP and CSRD requires accurate data management.
Platforms now exist to simplify this process. These tools act as a “registry of registries”, consolidating all EAC data into one place. Companies can automate calculations, streamline certificate allocation, and gain clear oversight of their renewable energy claims. This makes compliance reporting faster, more transparent, and audit-ready.
Conclusion: Make the Right Choice for Your Business
Both renewable energy certificates and Guarantee of Origin play a critical role in helping organizations transition to clean energy and meet net-zero targets. While RECs dominate the U.S. market, GOs are essential for European businesses navigating stricter reporting standards.
For global organizations, leveraging a mix of RECs, GOs, and other EACs ensures a holistic approach to sustainability. By carefully managing these certificates, businesses can confidently claim their renewable energy achievements and lead the way toward a greener future.
