Is “Green” Energy Really Green?

"100% renewable" is one of the most-misunderstood phrases in Texas electricity marketing.

Texas leads the country in wind generation and is second in utility-scale solar. Plenty of legitimate green plans exist. But the way "green" gets accounted for in Texas retail electricity isn't what most people assume — and the gap between assumption and reality is wide enough for plenty of plans to claim more environmental credit than they deserve.

Here's how to tell which green plans are real.

The electron grid doesn't separate

First, the physics. When a wind turbine spins or a solar panel produces, the electricity flows into the ERCOT grid alongside electricity from natural gas, coal, and nuclear plants. The grid mixes them physically. The electrons reaching your outlet are the same blend everyone in your TDU territory gets — regardless of which plan you bought.

There's no "green wire" coming to your house. There's no separate renewable circuit. Your electrons aren't more or less wind-powered than your neighbor's.

What changes between a green plan and a conventional plan isn't the electrons. It's the accounting.

What a REC actually is

A Renewable Energy Certificate (REC) is a tradeable instrument that represents 1 megawatt-hour of renewable electricity generation. Generators (wind farms, solar facilities) earn one REC for every MWh they put on the grid. They can sell those RECs separately from the underlying electricity.

When a Texas REP advertises a "100% renewable" plan, what they're actually doing is buying enough RECs to match every kWh their green-plan customers use. The REP doesn't direct your specific electrons to wind generators. They buy claims on green generation that happened somewhere on the grid.

Is this a real thing or a fig leaf? Honestly: both, depending on the REC.

Bundled vs. unbundled RECs

This is the critical distinction most green-plan marketing skips.

A bundled REC is sold together with the underlying electricity. When a wind farm sells power to a REP under a long-term Power Purchase Agreement (PPA), the REC comes with it. The REP can claim that specific MWh of wind on a 1:1 basis. This is the strong form of "renewable" — the REP is actually causing more renewable generation to happen by being a buyer.

An unbundled REC is bought separately from the underlying electricity. The REP buys RECs from a clearinghouse that match their customers' usage but aren't tied to any specific PPA. The wind farm got paid for the electricity through one channel; the REP paid extra for the REC through another. The renewable generation happened — but it would have happened anyway, regardless of whether the REP bought the REC.

Bundled RECs drive new renewable buildout. Unbundled RECs subsidize already-built capacity. Both technically qualify as "renewable" for marketing purposes. The environmental impact differs by orders of magnitude.

Most green plans don't disclose which kind their RECs are. The few that do — Rhythm Energy publishes its generation mix quarterly; Green Mountain has a long-term PPA portfolio — are the ones with the strongest claim to "actually green."

Reading the generation source mix

Every REP is required by Texas law to publish a generation source mix annually — a percentage breakdown of where their electricity (and RECs) came from. Look at it.

A representative source mix for a Texas "100% renewable" plan might read:

• 70% wind (Texas-sited)
• 25% solar (Texas-sited)
• 5% other renewables

That's a strong plan. The wind and solar are physically in Texas, on the same grid you're connected to.

A weaker version:

• 40% wind (location: "various U.S. states")
• 50% solar (location: "various U.S. states")
• 10% biomass / hydro

The "various U.S. states" language means the RECs were purchased from a national clearinghouse. The renewable generation happened in Iowa or Oklahoma or somewhere. It counts as renewable on paper. It does nothing for the Texas grid.

If the disclosure isn't specific about where the generation occurred, assume the worst.

Texas wind vs. national offsets

Texas has the largest wind generation capacity of any U.S. state. The Panhandle and West Texas are dense with wind farms. The grid is set up to absorb that generation; transmission lines (CREZ lines, built specifically for this) carry the power from West Texas to load centers.

When a Texas-headquartered REP signs a PPA with a Texas wind farm, the green plan they sell is doing real work. The REP's purchase is part of what justifies new turbine construction. Your bill payment ends up — somewhere down the chain — helping fund more Texas wind.

When a Texas REP buys RECs from an Iowa wind farm to back a "100% renewable" plan, the relationship is much weaker. Iowa wind would have been built anyway. The REC purchase is a paper transaction.

Both qualify as "100% renewable" for marketing. Only one is meaningfully Texas-renewable.

The greenwashing patterns to watch for

A few specific red flags in green-plan marketing:

"Carbon-neutral" language without a backing methodology. Carbon neutrality involves offsetting emissions, which is different from renewable RECs. If a plan claims carbon neutrality, the EFL or the REP's website should explain how they calculate the offset. If they don't, it's marketing.

"Texas wind" without a percentage. Some plans say things like "Powered by Texas wind!" without disclosing what fraction. The PUCT-mandated source mix on the EFL has the real number. If the marketing says 100% Texas wind and the EFL says 40%, the marketing is misleading.

Premium pricing with vague backing. Some green plans price 1-2¢/kWh above equivalent conventional plans. If the premium is significant, the backing should be specific. Plans that charge a green premium but use generic unbundled RECs are charging you extra for a paper transaction.

"Renewable" plans without Renewable Energy Certificates at all. Rare but exists — a few small REPs market "renewable" plans backed by carbon credits, not RECs. These plans don't qualify under PUCT standards for renewable claims. Walk away.

The green premium math

In 2022, green plans in Texas typically priced 1-3¢/kWh above conventional plans. The premium was the "cost" of going green.

In 2026, that gap has narrowed dramatically. Texas has so much wind and solar generation that wholesale renewable supply is often cheaper than gas-fired supply during daytime hours. The best green plans in Texas (Rhythm Energy, Energy Texas, Green Mountain in some cases) price within 0-0.5¢/kWh of equivalent conventional plans. A few quarters, they're cheaper.

If you're paying more than a 0.5¢/kWh premium for a green plan in 2026, you're either subsidizing a plan with weak REC backing or shopping the wrong list. The cheapest 100% green plans on the market are roughly equivalent to mid-tier conventional plans on rate.

The honest assessment of REC-backed plans

Buying a REC-backed plan does something. It doesn't do as much as installing rooftop solar or signing a direct PPA with a generator, but it's not nothing.

In aggregate, REC markets create demand for renewable generation. When millions of customers buy green plans, REC prices rise, which strengthens the economics of new wind and solar projects. The marginal impact of any single customer is small; the cumulative impact of the market is real.

What REC-backed plans don't do: change the electrons reaching your house, or directly fund a specific power plant in the way an investor in that plant would.

What they do do: support the infrastructure of a renewable-energy economy, on a 1-for-1 generation basis (one MWh used = one MWh of renewable generation paid for, somewhere).

Whether that's worth paying for is a values question. If it is, pick plans backed by Texas-sited bundled RECs. They're the strong form.

Which REPs actually disclose this stuff

A short list of REPs that publish detailed generation-mix disclosures:

• Rhythm Energy — publishes quarterly generation source breakdowns, names specific facilities
• Green Mountain Energy — long PPA portfolio with named wind farms; one of the longest-running 100% renewable retailers in the U.S.
• Gexa Energy — NextEra subsidiary; backed by parent's renewable generation portfolio

REPs that offer green plans without granular disclosure include several large brands. Their plans qualify as renewable under PUCT rules but don't tell you how. That's not necessarily wrong — but it limits how much weight to put on the green claim.

When not to pay a green premium

A handful of cases where the green plan is the wrong call:

The premium exceeds 1¢/kWh. In 2026, you shouldn't be paying that. The market has moved.

The REP doesn't disclose REC sourcing. You're paying extra for an unverifiable claim.

The plan is a bill-credit plan with a green wrapper. The green wrapping doesn't fix the bill-credit gotchas. If the underlying plan structure is wrong for your usage, "100% renewable" doesn't help.

You're already on a low-carbon path elsewhere. If you've got rooftop solar, an EV, and a heat pump, the marginal benefit of a green retail plan is small. Optimize for rate; the carbon math already works.

The honest close

"100% renewable" in Texas electricity is a real claim with a meaningful definition behind it — but the strength of the claim depends on what kind of RECs back the plan and where the generation happened.

Look for plans backed by Texas-sited bundled RECs from named generators. Skip plans that charge a premium without disclosing the math. Treat "carbon-neutral" claims with skepticism until you see the methodology.

The grid mixes electrons. The accounting matters. Pick the plans where the accounting is honest.

» MORE: Understanding the EFL · The Texas power grid