GoO cancellations exceed 500 TWh mark for the first time

The demand for green energy within the European markets continues to grow. The recently published statistics by the Association of Issuing Bodies (AIB) show a new all-time high for 2018: For the first time ever, the number of cancellations of Guarantees of Origin (GoO) has exceeded the 500 terawatt hours’ mark.

Compared to the previous year, demand for green energy increased by 38 Twh. This corresponds to a growth rate of about 8 percent. By jumping over the 500 Twh line, demand for unbundled renewable energy in Europe has now doubled within the past five years.

“Compared to the sharp increase in 2017, when we observed a market growth of 30%, development of demand has slowed down during the past year. However, the overall trend remains very positive and is now back to the more linear growth path of the years 2014-2016, “says First Climate’s Head of Renewables Mike Hatert, who is also responsible for the company’s GoOs portfolio management.

 

Further growth despite increased procurement prices

As Mike Hatert points out, the AIB data must be assessed against the background of the general market situation and increasing procurement prices. “Last year, we saw a very volatile market with a sharp rise in the overall price level,” says Hatert. “It is remarkable that even in the context of increased procurement prices, buyers continued to invest in environmentally friendly energy supply. Demand from energy suppliers and businesses remained unbroken and in fact, increased even further.”

The growing interest in sustainable energy solutions is also evidenced by the success of initiatives such as RE100 or WeMeanBusiness. For example, the membership of RE100, a global alliance of leading companies committed to a 100% renewable energy target, has grown from 15 in 2015 to 165 as of today. In the past year alone, the initiative has gained over 40 new members.

Positive development throughout all major markets
As the AIB statistics show, the demand for renewable energy has grown throughout all important markets within the European Energy Certificate System (EECS): Switzerland, Finland, Italy, Norway and Sweden all reported an increase in GoO cancellations.

Growth was most pronounced in France, where demand grew by nearly 50%. The development in Germany is also noteworthy. On the largest EECS market, buyers cancelled more than 100 Twh worth of Guarantees of Origin raising the bar to a new record level.

Concerning generation technologies, hydropower continues to play a dominant role: Almost two-thirds of all GoOs traded within the EECS in 2018 originated from hydropower facilities. However, the share of other generation technologies continued to grow, albeit at a low level. Wind power contributed about 21% of the total generation. Biomass utilization came third with around 9%. In contrast to these two technologies, solar power showed a slightly negative growth and cancellations from solar GoOs dropped from 5 to 4% of the total share.