Price plateau for Guarantees of Origin

While Europe is enjoying its summer months and hopefully well-deserved holidays after a complicated year of uncertainties on the economical side but also for travelling, the market of Guarantees of Origins seems to have taken a break as well.

After a steady price hike (most GOs have seen their value double) during the second quarter of this year, less deals have been closed across the continent since July for most markets. We can interpret this “plateau” in the price curve as a normal phase of reassessment following a preceding surge, encouraged by a general slowing down of trading activities due to holidays.

It is interesting to notice that while most energy markets have seen steady price increases for several macro-economical reasons, the GO market seem to have shown rather low correlation with these moves and worked its own rhythm. We could expect more sympathy for the GOs for the energy complex, but the nature of the certificate’s lifecycle and comfortable supply seem to let them follow their own schedule. As the graph below shows, the YTD value of the current year GO has risen from 0.17 to 0.43 EUR.

Price development of YTD current year GoO. Sign up here:

Q2 price increase

If you wish to read about reasons for the Q2 prices hike, please refer to our March Insight. We also add that the increase seems demand driven as we saw many new participants and interests joining the growing market of Guarantees of Origin. Most probably they surpassed the available offer during this second quarter.

Then what can we expect after the holidays of the old continent? It will surely be necessary to keep an eye on the snow melts into the Nordic and Alpine reservoirs, as Hydro-energy remains the major supplier of GOs. New supplies are also being added on the offer side, with the Portuguese auctions gaining regularity soon, and numerous new productions synchronising with the grids. The demand side keeps growing too with more corporations willing to offset their scope2 emissions and the general appetite for ecology.

The outcome of the summer plateau isn’t clear. We can just say at this point that it has been less volatile than in the past, thanks to a gain in maturity of the market. This is good news for a reliable price tag on energy origin, very necessary for all the projects in the pipeline of Energy Transition.

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