Thanks to the opening of the electricity market, industrial, commercial and public consumers can now choose their electricity supplier. Among the criteria that influence the final decision, the origin of the electricity can play an important role. More and more consumers wish to consume electricity produced from renewable energy sources, which has a low impact on the environment. But, whatever their origin (fossil, nuclear, renewable), all electrons are identical and injected into the same transportation or distribution grid. Without a direct connection to a specific power plant, there is no possibility to filter electrons in order to receive only the ones with a selected origin.
Since the beginning of the 2000s, several European directives have led to the reorganisation of the rules applying on the energy markets in Member states. As far as electricity is concerned, the opening of the market is linked to the obligation put on electricity suppliers to inform their consumers on the individual share of each energy source in the electricity that is provided to them (Directive 2003/54/EC). This means that attributes of the electricity produced have to be recorded and tracked all the way from the production source down to the consumption site. The term “attributes” refers to the characteristics that are associated with a production episode of a specific plant: energy source (wind, hydro, or solar energy for example), technology that was used, support that was granted to the plant, country of origin, time of production…
For the end consumer, it means that he can base his decision according to the characteristics of the electricity he wants to be able to claim. In a context where markets are more and more integrated and large volumes of electricity are traded between countries, it is a real challenge, but also an obligation, to ensure that consumers are provided with a reliable and accurate information on the electricity they are buying.
Many certification systems exist
Numerous private initiatives emerged with the aim of ensuring the provision of information on their electricity to end consumers. The one with the largest geographic scope is the EECS (European energy certificate system), which is maintained by the AIB (Association of Issuing Bodies), and was initiated in the end of the 90s by Danish and Dutch energy utilities. This system is based on the issuing of electronic certificates that record all attributes for a specific MWh of electricity and that are exchanged between producers and suppliers to the destination of end consumers for whom they are redeemed. The electricity is traded separately and without any attributes. A final reconciliation of electricity and certificates is made at the supplier’s level, which enters in the composition of its commercial mix. In the case a consumer has bought a specific product mix (eg 50% hydro, 50% windpower), the supplier has to reserve for this consumer only a number of certificates that should correspond to the specific product the supplier has committed to supply to him. Hence if green electrons cannot go directly to the purchaser of the green product, certificates however ensure that green MWh have been injected onto the grid for him.
Next to this system a multitude of other systems similarly certifying the origin of electricity exist. These are certification systems based on yearly audits, the most well known being the TÜV. In this system an integrated supplier has the production of his plants audited so as to prove that it was sufficient to cover, for example, the green electricity that he has supplied to the customers of his green offer or to all his customers if he claims to be 100% green. If this certification also guaranties certain environmental aspects, like in the case of hydropower plants, then it is called a label. Labels can also verify the claims that are put forward by suppliers regarding the composition of a specific product: Naturemade for example verifies that the electricity product of a supplier is composed only of renewable electricity and that part of it comes from new power plants that fulfil some ecological criteria.
Finally, many market players use contracts in order to guaranty the supply of a specific kind of electricity. Contracts deal with physical energy and attributes: a producer commits to sell electricity from some of his plants that are fuelled by a renewable energy source to a supplier and he sells this electricity with its characteristics.
From the end of 2003 onwards, the obligation was put on Member states by the European Commission (Directive 2001/77/CE) to supply their producers with a mechanism enabling them to prove the renewable origin of their production of electricity, the so-called Guarantee of Origin (GO). The Commission applied the subsidiarity principle here and left up to the Members to choose how they would implement the GO mechanism. Needless to say, this led to a multiplicity of different national implementations. The AIB has created a standardised GO (the EECS GO), which is currently spreading among Member states.
The situation at the supplier’s level
If Directive 2003/54/CE obliges suppliers to disclose the composition of their electricity mix, it has not specified on which mechanisms they had to rely to track back the origin of the supplied electricity. As a result, different methodologies have been implemented nationally or even by each supplier in the absence of national rules. A mixture of production statistics, RECS certificates, GOs (standardised or not), labels are used in an often unharmonised way.
Harmonisation of tracking systems
It became necessary to start acting in favour of a streamlining of all these different tools. This is the objective of the E-TRACK team, led by the Öko-Institut, a German research center in applied ecology and co-financed by the European Commission programme Energy Inteligent – Europe. The first part of this project (2005-2007) consisted in defining a tracking standard for electricity in order to ensure the coherence of national systems in order to facilitate the trading of electricity and guaranty the quality and reliability of the information supplied to end consumers. This standard fits all Member states’ national legislation frameworks and enables to coordinate all types of already existing certification systems (based on certificates or not) in order to reduce the loss of information or double counting that can sometimes happen. In the end it recommends to use standardised GO preferably to other tracking schemes as the basis of the information provided to end consumers on their electricity from renewable energy sources. Information on electricity that would not be tracked by GOs would come from a set of default production values, that would be called the “residual mix”, which would correspond to the national production mix minus the information tracked by tracking systems.
In 2008-2009, the E-TRACK team has reviewed the status of implementation of the E-TRACK standard by Member states. The description of the standard and of its implementation in the 27 Member states is available on the project website www.e-track-project.org.
Diane Lescot, Observ’ER
For more information: All project documents are downloadable from the project website : www.e-track-project.org