The European energy market has evolved to meet the consumers’ demand for green energy sourcing. As part of this evolution, a number of products have emerged such as Guarantees of Origin, or GoOs. GoOs certify that a defined quantity of electricity provided to the final customer is produced from a renewable energy source.
1 MWh of electricity originating from a renewable energy source = 1 GoO
Renewable energy sources are continually replenished by nature and have a limited environmental impact. GoOs are issued from a number of renewable energy sources generating power such as Wind, Solar, Biomass and Hydropower, the most common of the list.
Evolution of the GoO market
Supply and demand for GoOs have continued their growth all over the European markets :
“According to data from the Association of Issuing Bodies, which facilitates the EECS (European Energy Certificate System) supply reached 602 TWh in 2018, and is projected to rise to around 650 TWh in 2019.
Demand stood at 508 TWh in 2018, projected to reach around 550 TWh in 2019” says Mario Perez, Senior specialist Gas and Power pricing at S&P Global Platts.
Demand has doubled in the past five years from 250TWh in 2013 to approx. 500 Twh in 2018 mimicked by the supply market that has gone from 300TWh in 2013 to nearly 600TWh in 2018.
“The growing interest in GoOs can be explained by the developing green energy commitment of the private sector. More and more companies are switching to green energy and are procuring GoOs to improve their carbon footprint and reduce their scope 2 emissions (scope 2 : indirect emissions linked to energy consumption).” as reported by Firstclimate, a pioneer institution in environmental asset management.
Intrapreneurial projects like EGMA and TEO - The Energy Origin have emerged to take part in the transformation of the Energy markets.
In this context, two intrapreneurial projects have been initiated by ENGIE Employees on the subject of GoOs. One of them, TEO, uses blockchain technology to provide transparency and traceability to customers using renewable energy.
Another intrapreneurial project, EGMA, a platform easing access to the energy wholesale markets for ENGIE’s clients : large industrials, banks and utilities. On EGMA, a client can request for prices on European markets then decide to go through a bilateral transaction, and all this within a few clicks. The platform has been open to Power and Gas markets, now also GoOs and soon other green products.
What first started as an intrapreneurial project initiated by Igal Madar in 2017 has now grown into a business platform involving more than 40 persons from front office, sales and traders alongside I.S development teams.
“ Delivering an increasingly automated service answers our clients’ needs for better transparency and efficiency.” states Edgar Oriol, business developer for EGMA.
In November/ December EGMA will accentuate its strategy to be an actor in the energy transition. Indeed it will be adding GoO’s to its tradable product list.
“Our ambition is to anticipate the market evolution by improving our offers regarding green products which are aligned with ENGIE’s zero-carbon strategy as-a-service.” adds Edgar.