Using green electricity is a relatively simple way to reduce a company's CO2 emissions. Many companies opt for this measure. The CO2 Performance Ladder sets strict requirements for what is meant by “green electricity”, see page 34 of Handbook 3.1. Below we give a brief explanation of what green electricity means according to the Ladder and we explain the most important concepts.
Green electricity is understood to mean electricity generated by sun, wind, water or biomass. Two things are important for green energy in the Ladder: additionality and demonstrability with Guarantees of Origin (GO) .
De Ladder considers it important that the purchase of green energy actually leads to the production of green energy. This is called "additionality" in jargon of the Ladder and means that the purchase of green energy by a company leads to more production capacity of green energy. This ensures that the market for green energy is stimulated.
All green energy sources receive certificates that show that they produce green energy. For every MWh of renewable electricity produced, a certificate is issued, a Guarantee of Origin. It must be demonstrable to the Ladder that your green energy is actually green energy. This is demonstrable with these GOs, which are issued by Issuing Bodies that are accredited by the Association of Issuing Bodies (AIB). A list of Issuing Bodies can be found here.
If you are a Dutch organization, with the Green Power Checker from the HIER foundation you can trace the origin of green power products. The information in the Green energy checker is based on the energy labels that Dutch energy suppliers must publish annually in May, supplemented with information that HIER requests from energy suppliers about the origin of these energy products. It is the responsibility of the customer to check whether the green energy product meets the requirements of the CO2 Performance Ladder.
The short answer is no. The reason for this is that the purchase of foreign green energy GOs does not in practice always lead to an increase in the production of green energy.
Suppose we look at Norway. That country only has green electricity, partly due to their large hydropower plants. As a result, no Norwegian is interested in a GO of green electricity, because everyone uses green electricity. A number of Dutch energy companies buy the GOs from Norway for a negligible amount and sell them in the Netherlands as green energy. In practice, the purchase of this electricity by companies does not lead to the production of extra green electricity, not in the Netherlands and not in the country of origin.
In theory, this problem can be solved by ensuring that green energy GOs in Norway get a higher price. The logical way to do this is by linking the GVs to a country's renewable energy obligation. This means that if a green energy GO for Norwegian electricity leaves the country, because it has been sold to the Netherlands, for example, it will be deducted from the sustainable energy production in Norway. And if this electricity is used in the Netherlands, it will be added to the Dutch sustainable energy production. After all, the electricity is then used in the Netherlands, so trade fairly.
If this link were to exist, the sale of green energy GOs from Norway to the Netherlands could result in Norway having to produce extra green energy to meet its obligation (and the Netherlands less), because of additionality.
Based on this reasoning, we have included requirement 3.2 in Handbook 3.1:
“3.2 The electricity is imported from a member state of the European Union or another country that has agreed an EU renewable energy target with the European Commission. The Netherlands does not have these agreements. In all cases under 3.2, it must be demonstrated that the exporting country deducts (not counts) the emission reduction as a result of the exported electricity under the EU renewable energy directive in the reports to the European Commission. " (Handbook 3.1, page 35)
This shows that we are not fundamentally against imports, but that we are sticking to the principle of additionality.
The idea behind the CO2 Performance Ladder is "to reduce CO2 together". By ensuring that certified organizations only purchase green energy that actually stimulates the production of green energy, a larger market for green energy is created. After all, more demand means more production. And this reduces CO2 emissions.
As explained in the previous questions, we can only demonstrate this at the moment for domestic GOs for green energy.
Only domestic green energy can be counted with the emission factor for green energy. For green energy from abroad, the emission factor for gray energy applies.
Biogas is gas that is produced from renewable sources, such as organic waste, manure or sewage sludge. Biogas can be used for three purposes:
- for electricity and heat production;
- it can be upgraded to Bio CNG;
- it can be fed into the gas network as green gas.
The latter two cases involve green gas.
The term green gas is used to indicate that it is biogas that has been upgraded to natural gas quality. Just as for green electricity, in some EU countries there is a certification system for green gas. However the EU market for green gas is less developed than the market for green electricity. In The Netherlands VertiCer is responsible for this, an independent institute mandated by the Ministry of Economic Affairs and Climate. VertiCer certificates prove that the green gas is produced from biomass and that it has the same quality as natural gas. The certificate is the so-called 'Guarantee of Origin' (GO). One VertiCer certificate stands for 1 MWh of energy from green gas, which is comparable to approximately 100 cubic meters of natural gas.
In the event that the green gas is not fed into the national gas network, the GOs that VertiCer provides are recognizable as 'GO non-grid supply'. These 'GOs non-grid supply' therefore have a fixed destination and are not freely tradable. As soon as green gas is fed into the gas network, it is no longer recognizable as green gas because it mixes with natural gas in the transport pipe. The gas is traded as normal fossil gas and transported to users. The green attribute has been transferred to the certificate and can then be traded separately from the physical gas flow and reconnected to the physical gas flow if an end user consumes the green gas. As a result, anyone who wishes to buy green gas without being physically connected to a green gas producer can still make their energy consumption more sustainable. Just as with electricity, there are therefore two markets: a physical gas market (gas trade) and a virtual certificate market (certificate trade). An end user can indicate to his supplier that he wants to buy green gas in order to green his gas use. Your supplier or certificate dealer will have to buy and deduct green gas certificates for this. Individual certificates can only be purchased by traders. The writing off of certificates for use (sale of green gas to an end consumer) is mandatory.
It is also possible to drive on green gas in the form of Bio CNG (Compressed Natural Gas). It is an alternative to driving on natural gas (CNG). It is possible that the gas station where you refuel your natural gas offers you that option with certificates. It is also possible to purchase certificates separately to run your company fleet on green gas. For this you can contact a dealer or supplier. In The Netherlands the registration of the certificates is done via an account of the Dutch Emission Authority (in Dutch: NEA) within the VertiCer system.
In The Netherlands ,since 2019, every green gas certificate from VertiCer with an NTA8080 or ISCC quality mark has a verified emission factor stated in gr. CO2/MJ. If this factor is missing, the most accurate CO2 emission factor from the website www.co2emissiefactor.nl should be used for green gas in the Netherlands. The website distinguishes four types of emission factors for green gas:
- Green gas (landfill gas)
- Green gas (co-fermentation)
- Green gas (GFT fermentation)
- Green gas (sewage sludge)
In addition, an emission factor with an average value is stated, which is explicitly not intended for individual emission calculations. It is clearly demonstrable at the GO from which source the green gas comes, so which emission factor should be used. In other countries other factors may be more accurate.
There are providers who offer 'green gas' through CO2 compensation. The relevant providers buy so-called carbon credits for this on the international market. There are several reliable standards for this: the Clean Development Mechanism, which is part of the international Climate Treaty, the Gold Standard and the Voluntary Carbon Standard. CO₂ compensation measures are not valued within the CO₂ Performance Ladder. Compensation measures therefore do not contribute to achieving a (higher) level on the CO₂ Performance Ladder. Compensated gas therefore does not count as green gas for the CO2 Performance Ladder.
NB: the CO₂ Performance Ladder does not, however, make any statement about the social relevance of such measures.
If you have any questions, please contact SKAO or visit the VertiCer website.
