Guarantees of Origin (GOs)

Supporting Businesses to Meet Renewable Energy Targets

Across Europe

What is a GO? The GO system

A GO is a type of Energy Attribute Certificate Each EU member state is mandated by European
(EAC), which represents the environmental law to have a GO certificate system to track
attributes of the generation of one megawatt proof of electricity origin, and has a GO issuing
hour (MWh) of electricity produced by renewable body which is responsible for designing and
sources. GOs are issued in Europe and offer implementing it. When stakeholders refer to
companies flexibility to source renewable the GO market, they are usually referring to the
electricity in the locations most important to them. standardised European Energy Certificate System
(EECS) GO market, which currently consists of 21
How can purchasing GOs
countries in the European Economic Area (EEA).
benefit my business?
The EECS GO system was established by the
Like all EACs, GOs enable companies Association of Issuing Bodies (AIB) in 2002, and has
to credibly claim renewable electricity evolved into a large, valuable and credible market.
consumption and report lower Scope 2 All international transfers of EECS-GOs go through
emissions according to the Greenhouse the electronic hub operated by the AIB. GOs can
Gas (GHG) Protocol Scope 2 Guidance. be transferred between EECS countries with no
risk of double counting, claiming or attributing.
Where are GOs available?
Each GO is issued with a serial number unique
GOs are available in 28 countries in the European
to that MWh, which traces the GO from creation,
Union (EU), plus Norway, Switzerland and Iceland.
to issuance, transfer, then redemption, ensuring
Natural Capital Partners specialises in working
a robust system which meets the criteria of unique
with clients to select the best EAC options
claims. The validity of a GO expires 12 months after
for their business. We often customise EAC
issuance. Certificates that have not been cancelled
portfolios including GOs in Europe, Renewable
by this deadline are expired automatically, at which
Energy Certificates (RECs) in North America and
point their attributes flow into the grid and are
International RECs (I-RECs) across the rest of
reflected in the residual mix.
the world, to optimise selection criteria such
as technology type, location, electricity vintage A number of individual EU countries have national
and more. GO schemes but have not joined EECS; the largest of
these is the Renewable Energy Guarantees of Origin
The demand for renewable electricity in
(REGO) system in the UK, administered by Ofgem.
Europe documented by GOs is growing rapidly -
There are 31 countries with GO schemes in total –
by ~10% each year (CAGR). GOs representing
both in EECS (21) and with national schemes (10).
1,183 TWh were generated in 2017, approximately
70% of which were issued by Austria, Finland, Contact us for more information
Norway, Spain, Sweden and Switzerland.
on how to get the best value for the
business through your GO purchases.
Figure 1: The Availability of Guarantees of Origin Across Europe

AIB Member Countries National GOs

1. Austria 1. Bulgaria
2. Belgium 2. Greece
3. Croatia 3. Hungary
4. Cyprus 4. Latvia
5. Czech Republic 5. Malta
6. Denmark 6. Poland
7. Estonia 7. Portugal
8. Finland 8. Romania
9. France 9. Slovakia
10. Germany 10. United Kingdom
11. Iceland
12. Ireland
13. Italy Other countries
14. Lithuania – import only implementing GO systems
15. Luxembourg 1. Bosnia and Herzegovina
16. Netherlands 2. Montenegro
17. Norway 3. Serbia
18. Slovenia AIB GO National GO
19. Spain
20. Sweden
21. Switzerland

Technology mix Hydropower

Figure 2: The Technology Mix of GOs Issued by AIB - Rivers are re-directed through hydro generators to
Year to Date (October 2018)
produce electricity. Hydropower categories include
“reservoir production,” whereby water stored in
5% reservoirs is released when demand increases; “run-
of-river,” which uses natural river flows; and “small
9% 21% n Hydropower scale origin,” which have less than 20MW capacity.

n Wind Older installations are regularly upgraded to

improve efficiency, while newer operations are
n Biomass
designed to account for environmental impact
n Other and improve biodiversity.
65%
Most hydropower in Europe comes from Norway,
where it represents ~95% of the country’s
electricity production, as well as from Sweden and
Wind and hydropower are the most significant Finland. Natural Capital Partners can additionally
contributors to the European GO market. provide hydropower-generated GOs from Croatia,
Due to the natural climates and topographic France, Slovenia, Switzerland and other countries.
variations of the continent, hydropower is
Wind
most common in the North and the Alps
while wind is common in the Nordics and Europe installed 16.8 GW of additional wind
Spain and solar is most common in the South. power capacity in 2017, marking a record year.
Following is an overview of the technologies The International Energy Agency (IEA) expects
available through Natural Capital Partners. wind to become the largest source of power
in Europe soon after 2030. It currently meets
11% of the EU’s power demand.
Wind power production is typically divided into Geothermal energy is only found naturally
two main categories according to whether it is in a few locations, mostly in Iceland where it
based onshore or offshore. Onshore wind is the generates ~30% of the country’s electricity.
cheapest form of new power generation and
brings direct economic benefits to surrounding On behalf of clients, Natural Capital Partners
locations including jobs and investments in local sources renewable energy from 13 different
communities. More and more offshore wind farms geothermal and hydropower stations in Iceland,
are being developed and now include a floating each with annual production above 12 TWh.
wind farm off the coast of Scotland, a world first. The Development of the Guarantee
of Origin Market
With excellent wind conditions and government
support, Denmark became a world leader in wind Figure 3: Number of AIB (EECS) and
National GO Cancellations Since 2010
power technology. Belgian, Irish and Italian wind-
generated GOs are also available.
800
Biomass
700
Biomass is a type of energy which comprises any
600
organic decomposable matter from plants or 171

animals available on a renewable basis, such as 500 252

214
wood, plants, waste, landfill gases and alcohol fuels. 400 221

200
When biomass fuels are used, steam turbines 300 132
140
121 472
or gasifiers generate electricity. The quantity 200 367
of carbon dioxide released is the same as the 314
343
223 236 246
amount the plants or animals consumed during 100 182

their lifetime. Biomass-generated GOs are 0

2010 2011 2012 2013 2014 2015 2016 2017
available across most of Europe.
n AIB GOs cancelled n National GOs cancelled
Solar
Recently issued AIB statistics show that both the
Photovoltaics (PV) convert light directly into
supply and demand of GOs is increasing, while the
electricity. As the technology has developed, the
gap between the two is closing. Comparing year-
cost of solar power generation has decreased and
to-date (YTD) supply and demand of GOs for 2017
has achieved grid parity in many markets, meaning
and 2018 show that supply is up by 45 TWh, while
the cost is the same as standard electricity. While
demand is up by 34 TWh, and wind and solar are
there are a growing number of large solar power
the highest growth areas.
installations, many hundreds of thousands of small-
scale systems on private and commercial rooftops The number of EECS GOs transacted and cancelled
comprise the majority of solar power generated. increased by 28% between 2016 and 2017, while a
similar increase was seen for national GOs.
Solar-generated GOs are available from across the
continent and particularly from southern Europe. “This growth signifies that the market is strengthening,
which will give businesses further confidence as
Geothermal
increasing numbers of them are using Guarantees
Geothermal energy captures heat from two to of Origin to document their renewable energy
three kilometres under the earth’s surface and purchases in Europe,” commented Oliver Crouch,
turns it into steam. The steam powers turbines, Chief Product Officer, Natural Capital Partners.
transforming thermal energy into electricity.
In addition, Norway’s share of issued GOs
While the installation cost of thermal power plants has fallen significantly, as has the share of
is high, the maintenance cost is low and production those issued from hydropower, both of which
is not dependent on weather conditions. were previously dominant in the market.
 EKOenergy ecolabel EKOenergy-labelled electricity fulfils additional
sustainability criteria of the produced electricity
with the aim of lowering the impact of renewable
power plants on biodiversity. For example,
EKOenergy considers how solar farms and
“Ecolabels are a way for companies
wind turbines impact the habitats of birds
to do more with their purchases.
and other species and looks at fish migration
EKOenergy, recognised in the GHG
Protocol Scope 2 Guidance, is one such and river connectivity issues around hydropower
option: It is a mark of quality which sits plants. EKOenergy-certified bioenergy originates
on top of tracking instruments.” CDP from efficiently-used residues and waste or
select forestry products (roots, stumps and
Natural Capital Partners’ clients have the option of large logs are excluded).
purchasing EKOenergy-labelled GOs from across
Europe. EKOenergy is an international ecolabel At least €0.10/MWh of each EKOenergy certified
for energy sold to and used by end-consumers. GO purchase goes towards EKOenergy’s Climate
Founded in 2013, it is a non-profit supported by Fund, which is used to finance new renewable
more than 45 environmental organisations from energy projects in developing countries that are
over 30 countries. managed by experienced non-profit organisations.

References: Development of the Guarantees of Origin Market (2009-2017), RECS International (September 2018). Available here.

About Natural Capital Partners

Natural Capital Partners manages EAC portfolios on behalf of clients. We are a world-leading
provider of innovative solutions for positive impact on the world’s natural capital. With more
than 300 clients in 34 countries, Natural Capital Partners delivers high-quality solutions for
renewable energy, carbon emissions measurement and reductions, water stewardship,
building supply chain resilience and protecting biodiversity.

Contact us to find out how to optimise your GO purchases

and achieve renewable energy targets around the world:
salesna@naturalcapitalpartners.com for North America
sales@naturalcapitalpartners.com for Europe and the rest of the world

London: New York:

167 Fleet Street, 1732 First Avenue, New York,
London, EC4A 2EA NY 10128 United States
T: +44 20 7833 6000 Tel: 1-212-390-8835

info@naturalcapitalpartners.com | naturalcapitalpartners.com

Natural Capital Partners Europe Limited. Registered in England No: 02979872

VAT No: 728827790. Registered Office: 167 Fleet Street, London EC4A 2EA, United Kingdom