by Lucas Grimes, CRS
The term “residual mix” is used heavily in the world of clean energy reporting, but is subject to varying interpretations among government organizations, voluntary standard-setting bodies, and market participants. In the U.S. this leads to a lack of standardized definitions, calculation methodologies, and comprehensive generation tracking data. Residual mixes represent unclaimed or unallocated emissions in a region and are critical for accurate electricity emissions disclosures and avoiding double-counting.1 However, this information is often unavailable, and when it is accessible, it tends to be inconsistent. In response, the Clean Energy Accounting Project’s (CEAP) new Guidance for Calculating Residual Mix tackles these challenges by clearly defining different residual mixes and explaining how they are used, and the types of data needed to calculate them. This guidance can be used by organization’s sustainability departments, wholesale market operators, load-serving entities (LSEs), and other regulatory policy makers who assign emissions to electricity for voluntary or compliance reporting purposes to gather and utilize the data necessary for residual mix calculations.
Understanding the Importance:
This guidance empowers entities to calculate residual mixes accurately across diverse use cases and regions, reducing double-counting, improving data reporting, and decision-making. This guidance gives data providers what they need to collect relevant data and publish residual mixes, and emphasizes the need for nationwide all-generation tracking, which would provide a comprehensive view of energy generation sources and transactions necessary to residual mix calculations.
What the Guidance Says:
Multiple applications exist for residual mix calculations, including consumer scope-2 reporting and LSE reporting. Within each application, various use cases arise where residual mix calculations are necessary. The guidance outlines two fundamental methodologies for residual mix calculations: Type A, encompassing all unclaimed generation, and Type B, incorporating Renewable Portfolio Standard (RPS) generation alongside unclaimed generation. Both methodologies rely on crucial data sources including regional total generation, specified transaction data, and RPS compliance records. However, obtaining reliable specified transaction data poses the largest challenge due to discrepancies in wholesale market disclosures, reporting practices among LSEs, and the proprietary nature of bilateral contract data. Although the guidance primarily addresses annual residual mix applications, its principles can be applied to more granular calculations, ensuring consistency and accuracy across different scenarios and regions.
Improving data sources is essential for accurate residual mix calculations. This includes obtaining data related to regional total generation, specified transaction data, RPS compliance, and other shared specified renewable energy attributes. Of these, obtaining reliable specified transaction data presents the greatest challenge due to discrepancies in wholesale market disclosures, varying reporting practices among LSEs, and the proprietary nature of bilateral contract data. Nationwide all-generation tracking is crucial for providing the comprehensive view of energy generation sources and transactions necessary for accurate residual mix calculations.
Key Takeaways:
- All-generation tracking is needed for better residual mix data
- Residual Mixes vary based on use case, location, and data availability
- Accurate residual mix calculations empower organizations to make informed decisions, reduce double-counting, and improve overall data reporting in the clean energy sector
Lucas Grimes is CRS’s Manager, Policy
1 Using a grid-average emission factor means averaging out emissions across the entire electricity grid, which can make it seem like all electricity comes from the same mix of sources, even though it doesn’t. This can lead to double-counting emissions because cleaner sources included in the grid-average are often already claimed by a specified user and including them in the residual mix makes the mix look cleaner than it really is.
