Support system : green certificates

Since January 1st 2002 a green certificate system has been in effect in the Flemish Region, with which Flanders aims to support and promote power generation based on renewable energy sources.

This is a two-pronged system. On the one hand producers of electricity based on renewable energy sources can receive green certificates. On the other hand there is a certificate obligation in place for power suppliers. They must submit a specific number of green certificates (quota obligation) in order to avoid a fine. 

 

The issuing of green certificates

Producers of electricity based on renewable energy sources can receive green certificates from the VREG for electricity generated in the Flemish Region from the following renewable energy sources:

  • Solar power 
  • Wind power 
  • Hydropower 
  • Tidal power 
  • Wave power 
  • Geothermal power 
  • Biogas 
  • Landfill gas 
  • Sewage gas 
  • Biomass energy

 

A green certificate provides support to the production of a certain amount of electricity from a renewable energy source. Producers who are awarded a green certificate do not receive it on paper, but as an electronic item in the VREG-operated certificate database which can be consulted by producers on the Internet.

Green certificates issued to production devices with a commissioning date before 2013 represent the supported production of 1.000kWh net electricity from renewable resources. Green certificates for production devices commissioned since 2013, represent 1.000 kWh multiplied by a technology & capacity specific bandingfactor that reflects the amount of support needed in order to pay back the investment in a reasonable production period without oversubsidising.

Producers may sell these green certificates. End-buyers of certificates are  electricity suppliers who still have not met their certificate obligation. They buy their certificates directly from producers or from traders who act as intermediates in the market. If the producer is also an electricity supplier, he can use his own certificates to meet their certificate obligation.

Producers can obtain green certificates by applying for them at the Flemish Energy Agency VEA ,who judges the application and calculates the amount of certificates to be issued, and passes on this information to VREG for the issuing of certificates.

 

Certificate obligation

Green certificate as proof of support of electricity share based on renewable energy sources

In Flanders each electricity supplier is obliged to  support a specific amount of electricity generated from renewable energy sources.  This amount corresponds to a specific minimum share (quota) of total electricity they supply to their customers. In 2002, the year in which the system came into practice, the minimum share amounted to 0.8% of their supply. This will increase to 20,5% by 2020.

As proof of compliance with this obligation  electricity suppliers are to annually submit a specific number of green certificates to VREG before 31 March of the following year. The number of certificates that are to be submitted by electricity suppliers is referred to as the supplier's "certificate obligation". Annually, VREG calculates the number of green certificates that is to be submitted by each supplier in order to comply with this certificate obligation. VREG will inform the supplier of this number, after which the supplier is to submit the required number of green certificates to VREG.

If a supplier also is a green electricity producer and therefore generates power from renewable energy sources, they can apply for  green certificates at VEA for their own production. If this is not the case, the supplier can purchase green certificates on the market from producers with electricity production from renewable resources.

 

Acceptability of green certificates

Not all green certificates can be used to meet the certificate obligation. Only green certificates issued by VREG are accepted.

Green certificates awarded for the generation of electricity based on specific waste materials (waste materials that can be recycled or processed in a superior manner), are not accepted for the certificate obligation.

Green certificates issued outside the Flemish Region may not be submitted to satisfy the Flemish certificate obligation.

 

Administrative fine

If a supplier submits the correct number of green certificates, they comply with their certificate obligation. If they submit too few certificates, they have to pay an administrative fine of 100 euros per missing certificate.

The administrative fines shall be paid to the Energy fund, which will be used, among other things, to subsidise projects involving renewable energy sources.

For detailed information see Green Power Producers (Dutch) 

Vreg is the Flemish regulator of the electricity and gas market
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