A Re-entry Permit is one of the types of the travel document obtained by filing Form I-131, Application for Travel Document. It is a passport-like booklet for multiple use. Usually, a Re-entry Permit is valid for 2 years, but the validity period may vary.
Lawful permanent or conditional residents should apply for a Re-entry Permit if they intend to be outside the USA for more than 1 year, but less than 2 years. It allows re-entering the United States upon returning from abroad, without having to obtain a returning resident visa. It establishes that you did not intend to abandon your status.
Meanwhile, you do not need a Re-entry Permit if you will be outside the USA for less than 1 year. In this case, you may use a Permanent Resident Card (Form I-551) as your travel document.
Also, a Re-entry Permit can serve as a passport, if you plan on travelling and cannot get a passport from your home country. Many countries may allow using a Re-entry Permit much like you would use a passport, placing necessary visas and stamps in it, so you may use it as your main travel document.
Please also note that to file Form I-131 and obtain a Re-entry Permit, you must be physically present in the USA when you file the form. And it is recommended to submit the application 3-4 months before you intend to travel abroad.