Understanding Renewable Energy Certificates: GOs, RECs, and I-RECs

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Guarantees of Origin (GOs)

In Europe, GOs serve as the official certification for renewable electricity. Established under the first EU Renewable Energy Directive in 2001, they provide proof that one megawatt-hour (MWh) of electricity was generated from renewable sources. 

The Association of Issuing Bodies (AIB) oversees the system, ensuring cross-border trade of GOs among participating countries. However, some nations, such as Romania, operate their own independent variations, complicating international transfers outside the AIB framework. 

While GOs facilitate transparency in renewable energy sourcing, their market remains volatile, influenced by factors such as weather conditions and policy shifts. This volatility became evident in 2024 when prices plummeted from 7-10 EUR/MWh in the previous year to under 1 EUR/MWh for contracts maturing in the following year.

Renewable Energy Certificates (RECs)

In North America, RECs function similarly, allowing organisations to verify their use of renewable electricity. The system is managed across ten regional registries, each with specific rules for certificate trade and transfer. REC systems are specific to a country or region, making their use limited to that area. 

RECs are used for voluntary and compliance purposes. Voluntary RECs help organisations meet stakeholder and sustainability goals. Utilities and energy retailers use RECs to fulfil state regulatory obligations, which mandate that retail electricity providers supply a minimum proportion of electricity from renewable sources. 

Multiple factors determine the pricing of RECs. Generally, RECs used for regulatory compliance are more expensive than those purchased voluntarily. RECs from high-fossil-fuel regions are generally more expensive than those from low-carbon grids, as they're seen as having a greater impact on displacing polluting energy.

International Renewable Energy Certificates (I-RECS)

Beyond Europe and North America, I-RECs provide a standardised system for verifying green electricity across more than 60 countries spanning Asia, Oceania, Africa, South and Middle America.

 Unlike GOs and RECs, which operate within national or regional frameworks, I-RECs follow a globally consistent certification process managed by The International Tracking Standard Foundation. Their international recognition makes them particularly valuable for multinational corporations seeking to meet sustainability commitments across different markets. 

The evolving I-REC market is subject to fluctuations. Availability can be affected by national regulations and political processes. Prices also vary widely due to the market's global reach. 

Peace Renewable Energy Certificates are I-RECs that guarantee additional social benefits. These certificates direct investments in renewable energy towards climate-vulnerable regions facing political instability and conflict risk.

Looking to sell your renewable energy certificates? Get in touch with us to explore your options and maximise their value!