What 24/7 CFE and granular certificates are
A renewable energy certificate under classic accounting represents 1 MWh of renewable generation, but it says nothing about when that generation happened relative to when the buyer consumed electricity. A buyer who consumes 100 MWh of grid electricity over a year, and retires 100 MWh of RECs over the same year, can claim 100% renewable, even if the RECs came from daytime solar in one state and the buyer was running data centers at midnight in a different grid zone.
24/7 carbon-free energy (24/7 CFE) is the next-generation framework that closes this loophole. Under 24/7 CFE, the buyer's claim is matched hour-by-hour and zone-by-zone: clean energy generated in hour H in grid zone G can only be claimed against consumption in hour H in grid zone G. The matching is granular in time and bounded in space.
The instrument that supports this matching is the Granular Certificate (GC), also called a Time-based Energy Attribute Certificate (T-EAC). The international standard for GCs is maintained by EnergyTag, an independent non-profit. The standard defines what data a GC must carry (timestamp, grid zone, fuel type, asset identity), how issuance is audited, and how the certificate is matched to consumption.
EDMA's R2 is designed to align with the EnergyTag Granular Certificate Scheme Standard. Every ETT minted under R2 carries an hourly timestamp and a grid-zone tag. Retirement requires a temporal and spatial match to a consumption attestation, enforced at the contract level. The One-Claim Ledger ensures no ETT can be matched to consumption in two different hours.
The flex half of R2 is demand response: the verified reduction of load during specific hours, used for grid services and corporate flex programs. We cover that in its own section below.
Why annual matching fails the new standard
The classic 100% renewable claim under annual REC matching has come under increasing scrutiny. The problem is structural, not procedural.
When a corporation reports 100% renewable electricity, what they typically mean is that they consumed X MWh of grid electricity over the year, and they retired X MWh of RECs over the same year. The match is at the annual aggregate level. The certificate that arrived in their portfolio in March doesn't have to correspond to electricity they consumed in March.
Three failure modes show up in nearly every careful audit.
The midnight solar problem. A 100% solar REC portfolio claimed by a 24/7 data center: the data center runs 8,760 hours a year; the solar farm only generates during daylight. Half the data center's consumption happens at night, drawing whatever the grid was producing then. The REC claim covers coal-fired generation at night with daytime solar attribution.
Geographic leakage. A REC issued in California can be retired by a buyer consuming electricity on the PJM grid in Maryland. The two grids are not connected at the wholesale level. The Maryland consumption was physically powered by Mid-Atlantic generation (mostly natural gas, nuclear, and some renewables). The California REC says nothing about that.
Vintage drift. A 2023 REC retired in 2026 still discharges a 2026 Scope 2 obligation in many jurisdictions, even though the generation physically happened three years prior.
The corrective response is hourly plus geographic matching. SBTi has signalled hourly matching will be a required dimension in their next target-setting revision. The GHG Protocol Scope 2 standard is under update consultation with the same direction. The EU's renewable hydrogen rules (Renewable Fuels of Non-Biological Origin under RED III) already require hourly matching for green hydrogen claims.
How R2 enforces temporal + spatial matching
The R2 flow keeps the temporal grain at one hour and binds every certificate to a grid zone. Both constraints are enforced inside the PoV Gate at mint and inside the retirement contract at the point of claim. Neither can be circumvented after the fact.
Generation evidence carries an hour-windowed timestamp pair (start_timestamp and end_timestamp exactly one hour apart) and a grid-zone identifier (CAISO, PJM, ERCOT, ENTSOE.NL, and so on). The producer's revenue-grade meter signs the kWh reading at the source.
The attestor quorum for R2 adds a GRID role to the protocol default. The GRID role is held by an ISO/RTO data integrator that independently confirms the hour window and the grid-zone identifier against the wholesale market's own records. This makes the time and place tags of every certificate independently verified by a third party that does not run the meter.
The One-Claim Ledger keys off (device_id + hour) at mint and off the ETT identifier at retirement. The same hour from the same device cannot mint twice; the same ETT cannot retire against two different consumption claims.
Retirement is the moment matching is enforced. A buyer's consumption attestation for hour H in grid zone G can only retire an ETT from hour H in grid zone G. Mismatched temporal or spatial parameters revert at the contract level. The seven-stage diagram below shows the full path.
Demand response runs a parallel flow. The asset is a verified load reduction rather than a verified generation event, but the verification stack is structurally identical: meter evidence at the source, three-role quorum with GRID confirmation, PoV Gate evaluation, mint as a Demand Response Token. We cover the flex side in its own section below.
Anatomy of an hourly certificate
Every R2 ETT carries a structured metadata payload that supports the EnergyTag Granular Certificate schema:
generation_window_start and generation_window_end: ISO 8601 timestamps exactly one hour apart. grid_zone: ISO/RTO code (CAISO, PJM, ERCOT, NYISO, MISO, ENTSOE.NL, and similar). fuel_type: solar, wind, hydro, geothermal, biomass, nuclear. asset_id: specific meter or unit identifier. project_id: generation facility identifier. quantity_kWh: 10 for a standard R2 ETT. evidence_hash: the canonical JSON dossier the attestors signed. attestor_uids: the attestation references the PoV Gate consumed at S04.
When a buyer retires an R2 ETT, the protocol records: consumption_window_start and consumption_window_end (must equal the generation window), consumption_grid_zone (must equal the generation grid_zone), retiring_entity_id, and retirement_purpose (Scope 2 hourly match, hydrogen production under RFNBO, RPS compliance, and so on).
The retirement receipt is the buyer's audit artifact. It is on Ethereum L1, immutable, and links to the generation evidence dossier through the evidence_hash. An auditor or regulator can walk back from the corporate Scope 2 filing to the original meter reading without going through EDMA itself.
Demand response: the flex side
Demand response (DR) is the verified reduction of electricity consumption during specific hours, typically in response to grid scarcity, peak demand, or low renewable output. Customers who reduce load during these hours are paid for the reduction, either by their utility, by the ISO/RTO running the wholesale market, or by a corporate flex program.
R2's DR flow is structurally identical to its generation flow, but the asset is negative load rather than positive generation. A DR event begins with a signal from the grid operator (load reduction is required between H1 and H2 in zone G). Customers enrolled in a DR program have a registered baseline load profile. During the event, the customer's meter records actual consumption. The reduction (baseline minus actual) is the verifiable asset.
The verification quorum is the same three-role pattern: METER_OP signs the meter readings; GRID confirms the event window and zone; AUDITOR signs the baseline methodology and the reduction calculation. The PoV Gate evaluates the same three checks (quorum, equality, exclusivity). On PASS, the protocol mints a Demand Response Token (DRT) per verified MWh of reduction.
Use cases. ISO/RTO capacity payments (utilities and aggregators receive payment for committed DR); ancillary services (emergency response, frequency regulation); corporate flex programs (data centers that can shift workloads off-peak); hydrogen production (aligning electrolyzer operation with low-cost, high-renewable hours).
DRTs are tradable in the same Tokens Marketplace as R2 hourly certificates, with separate metadata and a distinct fungibility class. A DRT cannot be retired as a generation certificate, and an R2 ETT cannot be retired as a DR claim. The instruments are deliberately non-substitutable.
Standards alignment
R2's design intent aligns with the major standards converging on temporal and spatial matching. Formal accreditation to any specific standard is a separate audit process; the design choices below position R2 to pursue that accreditation as the standards finalise.
EnergyTag Granular Certificate Scheme Standard. R2's metadata schema is designed to align with EnergyTag's GC requirements. R2 ETTs are designed to be exportable as GCs to external registries that support hourly issuance under EnergyTag Configuration 3 (independent GC issuer model).
GHG Protocol Scope 2 Guidance update. The Scope 2 standard is under update consultation. The proposed direction requires hourly matching and stricter deliverable market boundaries for the market-based method. R2's hour-and-zone matching is designed to satisfy both proposed requirements.
SBTi target-setting framework. The next revision is expected to require hourly matching for science-based renewable energy targets. R2's certificate is matched at one-hour resolution.
Climate Group 24/7 Carbon-Free Coalition. A voluntary corporate framework for 24/7 CFE commitments. R2 retirement records carry the hour-stamped attestation that the Coalition criteria require for credible claims.
EU RFNBO rules under RED III. Renewable hydrogen production requires hourly matching of input electricity. R2 ETTs can be retired against hydrogen electrolyzer consumption with hour-resolution evidence.
EU GO scheme (AIB). Existing year-resolution GOs do not carry hour stamps. R2's bridge attestations are designed to preserve EU GO compatibility while adding the temporal layer the GO scheme does not natively support today.
Where it stands
R2 is built on the same protocol infrastructure as R1 (PoV Gate, One-Claim Ledger, Attestor Registry). The R2-specific work is in three areas:
GRID role integration. Data adapters for the major ISO/RTO APIs (CAISO, PJM, ERCOT, NYISO, MISO, ENTSOE-E, and equivalents in other jurisdictions) that allow the GRID attestor to independently confirm hour windows and zone identifiers against the wholesale market's own records.
Consumption-side attestation schema. A Consumption.v1 attestation type parallel to the generation-side Verification.v1, with the same canonical-JSON discipline. The buyer's METER_OP and AUDITOR sign hourly load readings the same way producers sign hourly generation.
Demand Response Token contract. A separate token class with baseline plus reduction methodology and a distinct fungibility class from R2 hourly ETTs.
R2's market readiness depends on three signals from the broader ecosystem: the GHG Protocol Scope 2 update finalisation, the SBTi target-setting revision incorporating hourly matching, and corporate adoption of 24/7 CFE commitments beyond the current hyperscaler cohort. The protocol design is forward-positioned: R2 is intended to ship with the EnergyTag-aligned schema in place from day one, so buyers who need hourly matching today can retire R2 certificates against their consumption immediately, with the certificate forward-compatible with whatever the official standards finalise.
For the protocol-level architecture this route depends on, see Proof-of-Verification, One-Claim Ledger, Attestor Registry, Compliance credits (R1), and Energy: double count.
