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Energy Studies | 30th Oct, 2023

GoOs prices in Europe: Reviewing the last 3 years


Guarantees of Origin (GoOs) have become increasingly significant in Europe's energy landscape.

Reading time : 2 min

Written by

Tomás Oliveira

GoOs act as a certification for energy derived from renewable sources, serving to ensure transparency and sustainability. However, GoOs prices have been subject to significant fluctuations in recent years (Figure 1).


Historical price evolution of GoOs in Europe

 

Let's explore the main factors influencing these prices:

1. Supply 

1.1. Regulatory dynamics: The evolving EU guidelines ensure companies adhere to sustainable practices. The constant evolution of the regulatory framework, coupled with the EU's aggressive renewable energy goals, can cause shifts in GoOs prices. Added to this are potential changes in voluntary market mechanisms, bringing in more layers of risk.

1.2. Hydropower GoOs and their market influence: In the past three years, hydropower GoOs have held an imposing share of around 30% in the electricity market (GME) meanwhile solar had 13% and wind 11%. Nonetheless, changing climatic patterns, marked by decreased rainfall, impact hydropower production, leading to a dip in certificate supplies. 

 

2. Demand

2.1. Pledge to sustainability: Europe's zero carbon targets for 2030, 2040, and 2050 have invigorated the demand for clean energy and, consequently, GoOs.

2.2. Public expectations: A more environmentally conscious public is exerting pressure on businesses to adopt eco-friendly strategies, further fueling the demand for GoOs.

Guarantees of Origin issued on a annual basis

 

Conclusion

According to S&P Global, average GoOs prices for solar and wind energy are anticipated to stabilize at around 8 MWh between 2023 and 2030. Within this pricing context, around 4-5 GW of new renewable installations are expected to be encouraged annually across Europe.

Furthermore, the European PPAs market is growing and adapting to the dynamics of GoOs. With Europe's continued commitment towards sustainability and the energy transition, transparency in energy generation and trading becomes imperative. In this scenario, GoOs not only validate the origin of renewable energy but also provide an additional source of revenue for generators. Simultaneously, PPAs emerge as a robust solution to ensure long-term financial stability and viability in the renewable energy sector. 

Our advisory team at Synertics is ready to help you decarbonise your energy consumption and leverage GoOs to your sustainability goals.
 

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