THEMA report on GO market for Sino-German Energy Partnership now available

For the German Agency for International Cooperation (GIZ) and its Chinese partners, THEMA analysed the European GO market. Our analysis zeros in on regulatory and historical market developments, providing key insights to inform the evolving Chinese scheme, where RES certificates play an increasingly important role.

European Guarantees of Origin (GOs) play a valuable role in compensating renewable power producers for the added value they bring to consumers. Traditionally priced around 1 EUR/MWh, 2022 witnessed a surge to record prices, reaching nearly 10 EUR/MWh for Nordic hydro certificates due to heightened end-user demand and a tight GO supply.

Now, prices have fallen again but stabilized at significantly higher levels of ca.4-5 EUR/MWh, reflecting the dynamic nature of the market. Predicting future developments is challenging, given the ongoing growth in both demand and supply and a constantly evolving regulatory landscape. To add to the complexities, different attributes of GOs may gain varied valuations in the evolving landscape.

The THEMA report provides a detailed exploration of the Guarantees of Origin system, covering regulatory insights, historical evolution, market dynamics, and examples of mutual recognition with 3rd countries. The success of renewable energy expansion and industrial decarbonization across Europe, influenced by sustainability reporting standards, will shape the market’s trajectory.

Looking ahead, regulatory advancements will be instrumental in determining the GO market’s significance. The report serves as a valuable resource for Chinese partners, offering insights that can guide their understanding and potential adoption of robust, internationally accepted standards in China’s Green Energy Certificate (GEC) trading initiatives, contributing to the global recognition of the scheme.

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