For most companies, purchased electricity (Scope 2) is the fastest credible emissions reduction available — and energy attribute certificates are the instrument that makes it claimable. Across much of the world, that instrument is the I-REC. Used well, it delivers genuine, defensible Scope 2 reductions; used carelessly, it buys paper that no longer survives an assurance review.
What an I-REC is
An I-REC (International Renewable Energy Certificate) is a tradable certificate representing proof that one megawatt-hour of electricity was generated from a renewable source. It separates the environmental attribute of the electricity from the physical electrons, so a company can buy and retire the attribute to back a renewable-energy claim even when the grid it draws from is mixed. The I-REC Standard is administered by the I-REC Standard Foundation (operated by Evident).
The family of energy attribute certificates
I-RECs are one member of a global family of energy attribute certificates (EACs). In North America the equivalent is the REC; in Europe it is the Guarantee of Origin (GO); and across much of Asia, Africa, Latin America and the Middle East — including India — the I-REC is the dominant instrument. They do the same job under different governance, and which one applies depends simply on where your consumption sits.
How they cut Scope 2
Under the GHG Protocol Scope 2 Guidance, companies report Scope 2 two ways: location-based (the grid average) and market-based (reflecting the energy products they have chosen). Retiring EACs matched to your consumption is what lowers the market-based figure — and the market-based number is the one most targets, including SBTi pathways, are measured against.
Quality and credibility
Not all certificates are equal in the eyes of scrutiny. Expectations are tightening toward better geographic and temporal matching — certificates from the same market as your consumption, and increasingly from the same time period — and toward demonstrable impact. RE100, the corporate renewable-electricity initiative, has hardened its technical criteria accordingly. Unbundled certificates remain valid under market-based accounting, but are best treated as a bridge rather than a destination.
Unbundled certificates, PPAs and on-site
- Unbundled I-RECs: fast, flexible and low-cost, with the weakest additionality story.
- Power purchase agreements (PPAs): a contract for renewable power (physical or virtual) that adds price certainty and a stronger additionality narrative, at the cost of a term commitment.
- On-site generation: solar or wind on your own assets — the most direct and visible option where it is feasible.
The emerging frontier: 24/7 carbon-free energy
Leading buyers are moving beyond annual matching toward 24/7 carbon-free energy — matching consumption with carbon-free generation every hour. Most companies need not start there, but new contracts should be structured so they remain compatible with hourly matching as expectations evolve.
Using them well
Align certificate procurement with your Scope 2 accounting, your RE100 or SBTi commitments, and the claims you intend to make. Prioritise matching quality over the cheapest certificate, and structure procurement so it delivers reductions that survive assurance — not just a line in the sustainability report.
Sources & further reading
This article is general information, not legal, financial or compliance advice. The regulations and standards referenced here evolve; verify the current position with the issuing body, or ask us. Published June 2026.