Guarantee of Origin (GO) is a market-based instrument that certifies the origin of electricity produced from renewable energy sources. It is a certificate that guarantees that a unit of energy has been produced from a specific renewable source, such as wind, solar, hydro, or biomass. The GO system provides a transparent and reliable way for energy providers to prove the source of their renewable energy, and for consumers to verify that the energy they are using is produced from sustainable sources. In this article, we will explore how the GO system works in the EU and the USA and the benefits it brings to both energy providers and consumers.
The GO system was introduced by the EU in 2001 to promote the use of renewable energy sources and meet its climate change targets. In the EU, the GO system is managed by the Association of Issuing Bodies (AIB), which is a voluntary association of national GO issuers. National GO issuers are responsible for issuing GOs to renewable energy producers, who can then sell them to energy suppliers or directly to consumers. Once the GO is issued, it is entered into a central electronic registry maintained by the AIB, which ensures that the GO can be tracked and verified.
In the USA, the GO system is called Renewable Energy Certificate (REC), and it operates similarly to the EU GO system. The REC system is a voluntary market-based instrument that certifies the generation of renewable energy. RECs are issued by independent third-party organizations and represent the environmental attributes of one megawatt-hour (MWh) of renewable energy. RECs can be traded separately from the energy itself, which means that consumers can purchase RECs to support the production of renewable energy, even if they are not using the energy directly.
The GO system provides numerous benefits for both energy providers and consumers. For energy providers, the GO system provides a mechanism to prove that their energy comes from renewable sources, which can help them to differentiate their products and gain a competitive advantage in the market. This can be particularly important in countries where the energy market is liberalized, and consumers have a choice of energy suppliers. By providing renewable energy with a unique identifier, the GO system allows energy providers to create value for their renewable energy production, which can attract investment into the sector.
For consumers, the GO system provides a transparent and reliable way to verify the source of their energy. By purchasing renewable energy with a GO, consumers can be sure that their energy is produced from renewable sources and has a low environmental impact. This can be particularly important for companies and organizations that want to reduce their carbon footprint and meet their sustainability goals. Moreover, the GO system allows consumers to make informed choices about their energy consumption, which can help to drive demand for renewable energy and promote the transition to a low-carbon economy.
Another benefit of the GO system is that it provides a way to track the environmental impact of energy production. By recording the origin and type of renewable energy produced, the GO system allows for the creation of accurate statistics on the use of renewable energy sources. This can help policymakers to design effective policies and regulations to promote the use of renewable energy and meet climate change targets.
In conclusion, the GO system is a market-based instrument that promotes the use of renewable energy sources and provides a transparent and reliable way to certify the origin of renewable energy. The GO system offers numerous benefits for both energy providers and consumers, including the ability to differentiate products, verify the source of energy, reduce carbon footprint, and create accurate statistics on the use of renewable energy sources. The GO system has been successful in promoting the use of renewable energy in the EU and the USA and has the potential to be adopted in other countries and regions to promote a sustainable energy future.