Friday, 18 September 2020
Greenfact recently hosted its annual conference that welcomed some of the world's leading renewable energy market players. This year we had over 150 participants from all over the world that joined the event online and in-person at Arctic Securities in Oslo, Norway.
The Greenfact conference was hosted on 16 September 2020 at the Arctic Securities office in Oslo, Norway. The theme for this year's conference was "The value of green attributes in a decarbonizing world". The main aim of the event was to bring together global market leaders to discuss recent trends within the green attributes markets, post COVID-19 outlook on the renewable energy market, and to reveal interesting views from the Greenfact annual survey.
The conference programme was divided into three sessions namely energy attribute certificates, renewable gases, and biofuels as well as Power Purchase Agreements (PPAs).
Renewable gases and Biofuels session
The overall theme and highlight of the biofuels session were that with the EU's ambitious decarbonization plans to be the first carbon-free region by 2050, the transport sector is the only sector where greenhouse gas (GHG) emissions are above 1990 levels. As such, the transportation sector is the most important sector that requires an urgent change in order for the EU to meet its goals but it is also the hardest sector to decarbonize, and this where biofuels come into play.
The recast Renewable Energy Directive (RED II) requires fuel suppliers to supply a minimum of 14% of the energy consumed in road and rail transportation from renewable energy by 2030. This will potentially lead to high use and demand for biofuels in the near future and will ultimately lead to new investments for the infrastructures necessary to keep up with the growing demand.
There are also gaseous biofuels that will play a vital role not only in the transportation sector but in an array of different sectors as well.
Renewable gases or gaseous biofuels will not only have an impact on the transportation sector but for all sectors that consume natural gas. The main highlights from this session were the important role that biomethane will play since it is chemically identical to natural gas and as such can be and will be used as a substitute to it in the next decades. Additionally, no extra infrastructure is needed as biomethane can be directly injected into the gas supply line (gas grid).
During this session, speakers discussed the various aspects of the biomethane markets namely the policy that is in place and what is required in order to enhance the deployment of renewable gas/biomethane installations. Leaders in this market further discussed the challenges they are facing within this market and the potential future opportunities at hand. The session was comprised of two of the largest producers of biomethane and liquified biogas (LBG) as well as the largest trader of biogas in the market.
A growing renewable gas sector which takes advantage of mixing and existing infrastructure also requires robust tracking systems, and the use of gas Guarantees of Origins and associated registries was discussed during the session. Particular attention was paid towards the UK market, where their gas GOs (RGGOs) are well established; pricing and demand were also considered.
Power Purchase Agreements (PPAs) session
A Power Purchase agreement is a contract between energy buyers and sellers. To advance renewable energy (RE) investment, governments usually provide financial incentives through subsidies like feed-in-tariffs. The main highlight of this session however was that we are currently in an era where feed-in tariffs are ending which has affected RE investors who have to find alternative ways to replace these subsidies. As such market players are faced with new challenges, specifically, the fact that they can't rely on fixed income based on PPAs but that they need to manage their PPAs and associated risks.
Michael Waldner from Pexapark and Joakim Johnsen from Aquila Capital showed in their presentations the new challenges being faced within the PPA sphere as well as the tools necessary to manage risks associated with PPAs.
Apart from this, we saw a tremendous corporate commitment to sustainability through PPAs with Alana Kühne from Ørsted discussing the major strides and successes the company has had. Ørsted signed the world's biggest offshore wind PPA with Covestro as well as signed the world's largest renewable corporate PPA with the Tawain-based TSMC.
Energy attribute certificate session
An energy attribute certificate is an official document that proves the origin of electricity consumed. In terms of the energy attribute certificate session, the highlights included news and updates on the US Renewable Energy Certificates (RECs) market from Scott Eidson from 3Degrees and the Guarantees of Origin (GO) markets in Europe from RECs International Director Adam White, AIB Senior Project Manager Katrien Verwimp and Greenfact. The highlight of this session was that the voluntary US RECs market shows that despite COVID-19 the market experienced higher prices when compared to the European GO market. One of the reasons for this is the fact that the US compliance RECs market affects the demand in voluntary markets something that is not seen in the European markets. RECS International's and the AIB's presentations focused on the REDII and the market designs of the GO markets for the next decade. We expect a higher degree of harmonization in the market as well as GOs for different energy carriers and renewable gases (e.g. hydrogen and biomethane).
Greenfact also revealed its market survey results which had respondents from over 100 companies who are leaders within the energy industry. Of the respondents, the majority felt that the GO markets required further legislative support specifically mandatory full disclosure. Respondents also felt that COVID-19 had impacted the demand and prices for GOs.
The conference was a great experience overall and we would like to thank all of the participants, speakers, and coordinators of the event. Footage and presentations from the event will be made available to conference participants soon.