ISDA has published a new US Renewable Energy Certificate (REC) Annex, reflecting increased interest in trading products that help companies meet renewable energy and emissions-reduction targets as part of their environmental, social and governance (ESG) strategy.
The ISDA US REC Annex allows firms to buy and sell US RECs based on standardized product definitions and terms under the umbrella of the ISDA Master Agreement, enabling more efficient trading of these instruments.
RECs represent the environmental attributes of renewable energy generation, and are issued when one megawatt hour of electricity is generated by a renewable energy source. Buyers of RECs have the rights to the characteristics of renewable energy, allowing firms that may not be able to connect directly to a renewable electricity supply to support clean energy and meet their ESG goals.
“The financial sector will play a crucial role in the shift to a greener economy by mobilizing capital to invest in sustainability projects and infrastructure. RECs help achieve this by enabling organizations to support renewable electricity wherever they are based, even if local energy suppliers do not offer it directly. By publishing the ISDA US REC Annex, firms will be able to trade these certificates based on standardized terms, making the process simpler, more efficient and more cost-effective,” said Katherine Tew Darras, General Counsel, ISDA.
The ISDA US REC Annex is the latest in a suite of documents published by ISDA designed to support trading of emissions and certain types of environmental derivatives, including templates for US and EU emissions and temperature-related weather transactions. ISDA will continue to work with members to identify other ESG-related areas where standard terms, documents and definitions are necessary.
Law firm Jones Day worked with ISDA to draft the annex.
A short video on the ISDA US REC Annex is available here.
For Press Queries, Please Contact:
Nick Sawyer, ISDA London, +44 20 3808 9740, nsawyer@isda.org
Lauren Dobbs, ISDA New York, +1 212 901 6019, ldobbs@isda.org
Joel Clark, ISDA London, +44 20 3808 9760, jclark@isda.org
Christopher Faimali, ISDA London, +44 20 3808 9736, cfaimali@isda.org
Nikki Lu, ISDA Hong Kong, +852 2200 5901, nlu@isda.org
Documents (1) for ISDA Publishes US Renewable Energy Certificate Annex
Latest
Joint Trades Submit Letter to BCBS Calling for Recalibration of Cryptoasset Prudential Standards
ISDA, in partnership with a coalition of leading global financial trade associations (“Joint Trades”), and with advisory support from Boston Consulting Group (BCG), Ashurst, and Sullivan & Cromwell, submitted a letter to the Basel Committee on Banking Supervision (BCBS). The...
ISDA Response on Common Carbon Data Model
On August 12, ISDA responded to a consultation from the Climate Data Steering Committee (CDSC) on a Common Carbon Credit Data Model. ISDA members believe the Group-of-20 carbon data model initiative is a positive step in addressing data gaps and...
Joint Response on RBA Consultation
On August 11, ISDA and FIA submitted a joint response to the Reserve Bank of Australia (RBA) on its consultation on guidance for Australia’s clearing and settlement facility resolution regime. The associations welcome publication of the draft guidance, which provides...
SwapsInfo H1 2025 and Q2 2025
Interest rate derivatives (IRD) trading activity increased in the first half of 2025, driven by continued interest rate volatility, evolving central bank policy expectations and persistent macroeconomic uncertainty. Trading in index credit derivatives also rose, as market participants responded to...