Overview of final draft text of Renewable Energy Directive (REDII) Comparing proposals from the EU Commission, Council and Parliament as of January 17th, 2018 - Includes only text elements which comprises Guarantees of Origin and Power Purchase Agreements (PPAs) directly - Recitals set out the reasons for the actual article and can be helpful when it comes to interpretation - Articles refer to the updated Directive text structure - Changes compared to the Commission proposal are indicated in bold text; deletions are marked with [ ]. Recital 43 Recital 45 European Commission proposal, 30 November 2016 Guarantees of origin issued for the purpose of this Directive have the sole function of showing to a final customer that a given share or quantity of energy was produced from renewable sources. A guarantee of origin can be transferred, independently of the energy to which it relates, from one holder to another. However, with a view to ensuring that a unit of renewable energy is disclosed to a customer only once, double counting and double disclosure of guarantees of origin should be avoided. Energy from renewable sources in relation to which the accompanying guarantee of origin has been sold separately by the producer should not be disclosed or sold to the final customer as energy from renewable sources. It is important to provide information on how the supported electricity is allocated to final customers. In order to improve the quality of that information to consumers, Member States should ensure that guarantees of origin are European Parliament plenary vote, 17 January 2018 Guarantees of origin issued for the purpose of this Directive have the sole function of showing to a final customer that a given share or quantity of energy was produced from renewable sources. A guarantee of origin can be transferred, independently of the energy to which it relates, from one holder to another. However, with a view to ensuring that a unit of renewable energy is disclosed to a customer only once, double counting and double disclosure of guarantees of origin should be avoided. Energy from renewable sources in relation to which the accompanying guarantee of origin has been sold separately by the producer should not be disclosed or sold to the final customer as energy from renewable sources. It is important to distinguish between green certificates used for support schemes and guarantees of origin. (Amendment 41) It is important to provide information on how the supported electricity is allocated to final customers. In order to improve the quality of that information to consumers, Member States should ensure that guarantees of origin are Council, text of 13 December, referenced on 18 December 2017 at General approach It is important to provide information on how the supported electricity is allocated to final customers. In order to improve the quality of that information to consumers, Member States should ensure that guarantees of origin are 1
Recital 46 Recital 47 issued for all units of renewable energy produced. In addition, with a view to avoiding double compensation, renewable energy producers already receiving financial support should not receive guarantees of origin. However, those guarantees of origin should be used for disclosure so that final consumers can receive clear, reliable and adequate evidence on the renewable origin of the relevant units of energy. Moreover, for electricity that received support, the guarantees of origin should be auctioned to the market and the revenues should be used to reduce public subsidies for renewable energy. Directive 2012/27/EU provides for guarantees of origin for proving the origin of electricity produced from high-efficiency cogeneration plants. However, no use is specified for such guarantees of origin, so they should also be used when disclosing the use of energy from high efficiency CHP Guarantees of origin, which are currently in place for renewable electricity and renewable heating and cooling, should be extended to cover renewable gas. This would provide a consistent means of proving to final customers the origin of renewable gases such as biomethane and would facilitate greater crossborder trade in such gases. It would also enable the creation of guarantees of origin for other renewable gases such as hydrogen. issued for all units of renewable energy produced. (Amendment 42) issued for all units of renewable energy produced, except for when they decide not to issue guarantees of origin to producers who also receive financial support, to account for the market value of the guarantees of origin. In addition, with a view to avoiding double compensation, renewable energy producers already receiving financial support should [ ] have the market value of the guarantees of origin issued to them deducted in that relevant support scheme. [ ] Directive 2012/27/EU provides for guarantees of origin for proving the origin of electricity produced from high-efficiency cogeneration plants. However, no use is specified for such guarantees of origin, so their use should also be [ ] enabled when disclosing the use of energy from high efficiency CHP Guarantees of origin, which are currently in place for renewable electricity [ ], should be extended to cover renewable gas. Extending the guarantees of origin system to renewable heating and cooling and fossil fuel sources as an option should also be enabled. This would provide a consistent means of proving to final customers the origin of renewable gases such as biomethane and would facilitate greater cross-border trade in such gases. It would also enable the creation of guarantees of origin for other renewable gases such as hydrogen. 2
Recital 99 In order to amend or supplement non-essential elements of the provisions of this Directive, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission in respect of the list of feedstocks for the production of advanced biofuels, the contribution of which towards the fuel suppliers' obligation in transport is limited; the adaptation of the energy content of transport fuels to scientific and technical progress; the methodology to determine the share of biofuel resulting from biomass being processed with fossil fuels in a common process; the implementation of agreements on mutual recognition of guarantees of origin; the establishment of rules to monitor the functioning of the system of guarantees of origin; and the rules for calculating the greenhouse gas impact of biofuels, bioliquids and their fossil fuel comparators. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making. In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts. In order to amend or supplement non-essential elements of the provisions of this Directive, the power to adopt acts in accordance with Article 290 of the Treaty on the Functioning of the European Union should be delegated to the Commission in respect of the list of feedstocks for the production of advanced biofuels, the contribution of which towards the fuel suppliers' obligation in transport is limited; the adaptation of the energy content of transport fuels to scientific and technical progress; the methodology to determine the share of biofuel resulting from biomass being processed with fossil fuels in a common process; the implementation of agreements on mutual recognition of guarantees of origin; the establishment of rules to monitor the functioning of the system of guarantees of origin; the rules for calculating the greenhouse gas impact of biofuels, bioliquids and their fossil fuel comparators; the establishment of a maximum allowable payback period as a sustainability criterion, in particular for ligno-cellulosic biomass; and, in order to ensure full transparency throughout all sectors of energy production, the establishment, by 31 December 2018, of production criteria for fossil fuels and fossil energies. It is of particular importance that the Commission carry out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law- Making. In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as 3
Article 2.2 cc power purchase agreement means a contract under which a legal person agrees to purchase renewable electricity directly from an energy generator; Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts. (Amendment 72) renewables power purchase agreement means a contract under which a legal or natural person agrees to purchase renewable electricity directly from an energy generator (Amendment 100) Article 15.9 Member States shall remove administrative barriers to corporate long-term power purchase agreements to finance renewables and facilitate their uptake. Member States shall carry out an assessment of the regulatory and administrative barriers and potential of the purchase of energy from renewable sources by corporate customers in their territories and shall set up an enabling regulatory and administrative framework for enhancing corporate long-term renewables power purchase agreements to finance renewables and facilitate their uptake, ensuring that those agreements are not subject to disproportionate procedures and charges that are not cost reflective. With the conclusion of such agreements, the equivalent amount of guarantees of origin issued in accordance with Article 19 shall be cancelled on behalf of the corporate customer. The enabling framework shall be part of the integrated national energy and climate plans in accordance with Regulation... of the European Parliament and of the Council [on the Governance of the Energy Union, 2016/0375(COD)]. (Amendment 161) 4
Article 19.1 Article 19.2 Article 19.2.3 For the purposes of proving to final customers the share or quantity of energy from renewable sources in an energy supplier s energy mix and in the energy supplied to consumers under contracts marketed with reference to the consumption of energy from renewable sources Member States shall ensure that the origin of energy produced from renewable energy sources can be guaranteed as such within the meaning of this Directive, in accordance with objective, transparent and non-discriminatory criteria. To that end, Member States shall ensure that a guarantee of origin is issued in response to a request from a producer of energy from renewable sources. Member States may arrange for guarantees of origin to be issued for non-renewable energy sources. Issuance of guarantees of origin may be made subject to a minimum capacity limit. A guarantee of origin shall be of the standard size of 1 MWh. No more than one guarantee of origin shall be issued in respect of each unit of energy produced. Member States shall ensure that the same unit of energy from renewable sources is taken into account only once. Member States shall ensure that no guarantees of origin are issued to a producer that receives financial support from a support scheme for the same production of energy from renewable sources. Member States shall Member States shall ensure that in the case of renewable energy installations commissioned after... [date of the entry into force of this Directive] no guarantees of origin are issued to a producer that receives For the purposes of proving to final customers the share or quantity of energy from renewable sources in an energy supplier s energy mix and in the energy supplied to consumers under contracts marketed with reference to the consumption of energy from renewable sources, Member States shall ensure that the origin of [ ] electricity and gas produced from renewable energy sources can be guaranteed as such within the meaning of this Directive, in accordance with objective, transparent and nondiscriminatory criteria To that end, Member States shall ensure that a guarantee of origin is issued in response to a request from a producer of [ ] electricity and gas from renewable sources, unless for the purposes of accounting for the market value of the guarantee of origin Member States decide not to issue one to a producer that receives financial support from a support scheme. Member States may arrange for guarantees of origin to be issued for heating and cooling from renewable sources as well as for electricity, gas or heating and cooling from non-renewable energy sources. Issuance of guarantees of origin may be made subject to a minimum capacity limit. A guarantee of origin shall be of the standard size of 1 MWh. No more than one guarantee of origin shall be issued in respect of each unit of energy produced. Member States shall ensure that the same unit of energy from renewable sources is taken into account only once. Member States shall ensure that [ ] when [ ] a producer [ ] receives financial support from a support scheme for the [ ] production of energy from renewable sources, the market value of the guarantee of origin for the same 5
issue such guarantees of origin and transfer them to the market by auctioning them. The revenues raised as a result of the auctioning shall be used to offset the costs of renewables support. financial support from a support scheme for the same production of energy from renewable sources, unless there is no double compensation. It shall be presumed that there is no double compensation where: (a) financial support is granted by way of a tender procedure or a tradable green certificate system; production is appropriately taken into account in the relevant support scheme. To take into account the market value of the guarantee of origin Member States may, inter alia, decide to issue a guarantee of origin to the producer and cancel it immediately or to issue such guarantees of origin and transfer them to the market by auctioning them. The revenues raised as a result of the auctioning shall be used to offset the costs of renewables support. (b) the market value of the guarantees of origin is administratively taken into account in the level of financial support; or (c) the guarantees of origin are not issued directly to the producer but to a supplier or consumer who buys the renewable energy either in a competitive setting or in a longterm corporate renewables power purchase agreement. Article 19.3 For the purposes of paragraph 1, guarantees of origin shall be valid with respect to the calendar year in which the energy unit is produced. Six months after the end of each calendar year, Member States shall ensure that all guarantees of origin from the previous calendar year that have not been cancelled shall expire. Expired guarantees of origin shall be included by Member States in the calculation of the residual energy mix. In cases other than those referred to in the fourth subparagraph, Member States shall issue the Guarantee of Origin for statistical reasons and cancel them immediately. (Amendment 171) For the purposes of paragraph 1, guarantees of origin shall be valid for [ ] twelve months after the production of the relevant energy unit. Member States shall ensure that all guarantees of origin [ ] that have not been cancelled shall expire. Expired guarantees of origin shall be included by Member States in the calculation of the residual energy mix. 6
Article 19.4 Article 19.6 For the purposes of disclosure referred to in paragraphs 8 and 13, Member States shall ensure that guarantees of origin are cancelled by energy companies by 30 June of the year following the calendar year in relation to which the guarantees of origin are issued. Member States or the designated competent bodies shall put in place appropriate mechanisms to ensure that guarantees of origin shall be issued, transferred and cancelled electronically and are accurate, reliable and fraud-resistant. Member States and designated competent bodies shall ensure that the requirements they impose are compliant with the standard CEN - EN 16325 For the purposes of disclosure referred to in paragraphs 8 and 13, Member States shall ensure that guarantees of origin are cancelled by energy companies within the period of validity [ ]. Member States or the designated competent bodies shall put in place appropriate mechanisms to ensure that guarantees of origin shall be issued, transferred and cancelled electronically and are accurate, reliable and fraud-resistant. [ ] Article 19.7.1 - (1. aa; new) whether the energy source from - which the energy was produced met the sustainability criteria and the greenhouse gas emissions saving criteria referred to in Article 26. (Amendment 172) Article 19.7.1 b (ii) gas, or (ii) gas, including hydrogen, or (Amendment 173) (Last paragraph of 19.7:) Article 19.8 Where an electricity supplier is required to prove the share or quantity of energy from renewable sources in its energy mix for the purposes of Article 3 of Directive 2009/72/EC, it shall do so by using guarantees of origin. Likewise, guarantees of origin created pursuant to Article 14(10) of Directive 2012/27/EC shall be used to substantiate any requirement to prove the quantity of electricity produced from high-efficiency cogeneration. Member States shall ensure that transmission Where an electricity supplier is required to prove the share or quantity of energy from renewable sources in its energy mix for the purposes of Article 3 of Directive 2009/72/EC, it shall do so by using guarantees of origin. Likewise, guarantees of origin created pursuant to Article 14(10) of Directive 2012/27/EC shall be used to substantiate any requirement to prove the quantity of electricity produced from high-efficiency cogeneration. In relation to paragraph 2, where electricity is Simplified information may be specified on guarantees of origin from installations of less than 50 kw. Where an electricity supplier is required to prove the share or quantity of energy from renewable sources in its energy mix for the purposes of Article 3 of Directive 2009/72/EC, it [ ] may do so by using guarantees of origin. Where Member States have arranged to have guarantees of origin for other types of energy, suppliers shall always use for disclosure the same type of guarantees of origin as the energy supplied. Likewise, guarantees of origin created pursuant to Article 7
Article 19.11 Article 19.13 Article 21.1.1a losses are fully taken into account when guarantees of origin are used to demonstrate consumption of renewable energy or electricity from high efficiency cogeneration. Member States shall not recognize guarantees of origins issued by a third country except where the Commission has signed an agreement with that third country on mutual recognition of guarantees of origin issued in the Union and compatible guarantees of origin systems established in that country, where there is direct import or export of energy. The Commission is empowered to adopt delegated acts in accordance with Article 32 to enforce these agreements. Where energy suppliers market energy from renewable sources or high efficiency cogeneration to customers with a reference to environmental or other benefits of energy from renewable sources or from high-efficiency cogeneration, Member States shall require those energy suppliers to use guarantees of origin to disclose the amount or share of energy from renewable sources or from high efficiency cogeneration are entitled to carry out self-consumption and sell, including through power purchase agreements, their excess production of renewable electricity without being subject to disproportionate procedures and charges that are not cost-reflective; generated from high efficiency cogeneration using renewable sources only one guarantee of origin specifying both characteristics, shall be issued. Member States shall ensure that transmission losses are fully taken into account when guarantees of origin are used to demonstrate consumption of renewable energy or electricity from high efficiency cogeneration. (Amendment 174) [ ] are entitled to carry out self-consumption and sell, including through power purchase agreements and peer-to-peer trading arrangements, their excess production of renewable electricity without being subject to discriminatory or disproportionate procedures and charges that are not costreflective 8 14(10) of Directive 2012/27/EC [ ] may be used to substantiate any requirement to prove the quantity of electricity produced from highefficiency cogeneration. For the purposes of paragraph 2, where electricity is generated from high efficiency cogeneration using renewable sources only one guarantee of origin may be issued specifying both characteristics. [ ] Member States shall not recognize guarantees of origins issued by a third country except where the Commission has signed an agreement with that third country on mutual recognition of guarantees of origin issued in the Union and compatible guarantees of origin systems established in that country, and only where there is direct import or export of energy. The Commission is empowered to adopt [ ] implementing acts in accordance with Article 31 to enforce these agreements. are entitled to: [ ] generate renewable energy, including for their own consumption [ ]; store and sell, including through power purchase agreements, aggregators and electricity suppliers, their excess production of renewable electricity without being subject to disproportionate procedures and [ ] network charges that are not cost reflective, ensuring
Article 22.1.1 Article 25.3.1 3 Article 25.3.1 a Member States shall ensure that renewable energy communities are entitled to generate, consume, store and sell renewable energy, including through power purchase agreements, without being subject to disproportionate procedures and charges that are not costreflective. To determine the share of renewable electricity for the purposes of paragraph 1 either the average share of electricity from renewable energy sources in the Union or the share of electricity from renewable energy sources in the Member State where the electricity is supplied, as measured two years before the year in question may be used. In both cases, an equivalent amount of guarantees of origin issued in accordance with Article 19 shall be cancelled (Amendment 178) Member States shall ensure that renewable energy communities are entitled to generate, consume, store and sell renewable energy, including through power purchase agreements, without being subject to discriminatory or disproportionate procedures and charges that are not cost-reflective. (Amendment 188) To determine the share of renewable electricity for the purposes of paragraph 1 the share of electricity from renewable energy sources in the Member State where the electricity is supplied, as measured two years before the year in question is used provided that there is sufficient proof that the renewable electricity is additional. The Commission is empowered to adopt delegated acts in accordance with Article 32 in order to supplement this Directive by establishing a methodology, including a methodology for the Member State to set their baseline, in order to prove additionality. (Amendment 223) (new) By way of derogation from the first subparagraph, to determine the share of electricity for the purposes of paragraph 1 in the case of electricity obtained from a direct connection to an installation generating renewable electricity and supplied to road vehicles, that electricity shall be fully counted as renewable. Similarly, electricity obtained through longterm power purchase agreements for renewable electricity shall be fully counted as renewable electricity. In any event, an equivalent amount of guarantees of origin they contribute in an adequate and balanced way to the overall cost sharing of the system [ ]28(footnote); Member States shall provide an enabling regulatory framework for renewable energy communities ensuring that: To determine the share of renewable electricity for the purposes of paragraph 1 either the average share of electricity from renewable energy sources in the Union or the share of electricity from renewable energy sources in the Member State where the electricity is supplied, as measured two years before the year in question may be used. [ ] 9
Article 25.3. 3 point a1 Article 27.1a When electricity is used for the production of renewable liquid and gaseous transport fuels of non-biological origin, either directly or for the production of intermediate products, either the average share of electricity from renewable energy sources in the Union or the share of electricity from renewable energy sources in the country of production, as measured two years before the year in question, may be used to determine the share of renewable energy. In both cases, an equivalent amount of guarantees of origin issued in accordance with Article 19 shall be cancelled. issued in accordance with Article 19 shall be cancelled. (Amendment 224) When electricity is used for the production of renewable liquid and gaseous transport fuels of non-biological origin, either directly or for the production of intermediate products, the average share of electricity from renewable energy sources in the country of production, as measured two years before the year in question, may be used to determine the share of renewable energy. An equivalent amount of guarantees of origin issued in accordance with Article 19 shall be cancelled. (Amendment 225) (new) In order to facilitate cross-border trade and disclosure to consumers, guarantees of origin for renewable energy injected into the grid shall contain information on the sustainability criteria and greenhouse gas emission savings as defined in Article 26(2) to (7) and may be transferred separately. (Amendement 256) When electricity is used for the production of renewable liquid and gaseous transport fuels of non-biological origin, either directly or for the production of intermediate products, either the average share of electricity from renewable energy sources in the Union or the share of electricity from renewable energy sources in the country of production, as measured two years before the year in question, may be used to determine the share of renewable energy. [ ] Links to complete documents: Commission proposal: http://eur-lex.europa.eu/legal-content/en/txt/?uri=celex:52016pc0767r%2801%29 Parliament adopted text: http://www.europarl.europa.eu/sides/getdoc.do?pubref=-//ep//text+ta+p8-ta-2018-0009+0+doc+xml+v0//en&language=en Council general approach: http://data.consilium.europa.eu/doc/document/st-15236-2017-init/en/pdf DISCLAIMER This document is for information purposes established to the best of our abilities and not a legal analysis. It is based on information which constitutes public information but it has not been independently verified and no warranty, whether express or implied, is given as to its accuracy. ECOHZ has no liability for any error or inaccuracy in this document. 10