Internal Market for RESE A first step creating an interface between support systems

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Internal Market for RES-EA first step - creating
an interface between support systems

• Claes Hedenström
• President RECS International
• 12 July 2007

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RECS internationalAn association of market
players

• 182 members in 24 countries
• 15 countries in the electronic certificate
  infrastructure
• 90 TWh/yr certified (20 of total RES-E in 2006)
• Association of Issuing Bodies (AIB) - the system
  owner
• Memorandum of Understanding with Eurelectric

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ChallengeRoad Map January 2007Presidency
Conclusions March 2007

• Take measures for a RES-E Internal Market
• Keeping existing support systems
• harmonisation not needed

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Imports of RES-E should account for national
targets

• A stepwise approach needed
• Member States may decide themselves when and how
  to open the border
• Certain conditions need to be considered
• The Guarantee of Origin (GO) the vehicle for
  trade
• No request for physical trade
• Minimum and maximum import for compliance
• New targets restricted to new power (after
  2010)
• Exports must be subtracted from target
  automatically
• Import should be non-subsidised in country of
  origin
• Eligible technologies to be chosen by importing
  country
• ..

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Two situations to be managed

• Certificate systems
• Quota obligation limits the volume
• Premium/feed-in systems
• No mechanism to control the volume

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Country with a Quota system
Quota obligation parties can partly comply max
x import
Quota compliance x import domestic
Domestic certificate price
Imported GO Price
Market price eligible GO
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Country with a premium system
x import Import rights are auctioned
Price import right
Market price eligible GO
Cost for import
Received premium
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Import of GoOs, max X allowed
Country with premium/feed-in system x import
Import rights are auctioned
Country with certificate systems Quota
obligation parties can partly comply max x
import
Price import right
Quota compliance x import domestic
Market price eligible GoO
Cost for import
Imported GoO Price
Received premium
Domestic Certificate price
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Imports of RES-E possible keeping the support
schemes

• Certificate systems
• Government allow parties with quota obligation to
  import GOs for compliance to a maximum share (e.g
  20 )
• Premium/feed-in systems
• Government allow system operator to auction
  import rights for a maximum volume of GOs (e.g 20
  )
• Premium is paid for GO plus import right
• Income for import rights used to lower the cost
  burden on customers

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Consequences for a tradable GO counting for target

• The GO system must be robust and reliable
• A standard is available Association of Issuing
  Bodies
• It has been proven to work (90 TWh in 2007)

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Concluding

• Find ways to encourage MS to open the border for
  imports of RES-E for compliance
• voluntary or obligation for a certain possible
  share?
• Strengthen article 5 of RES-directive
• Standardise the GoO
• Introduce principle of redemption legally and
  link this to target counting
• The targets must be formulated carefully
• Consumption targets related to new power
• The same should be considered for heatcooling

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