Guarantees of Origin ensure a company’s sustainability – Without them green electricity is just electricity

Demand for sustainable energy is increasing as companies strive towards their climate goals. However, it isn’t enough for a company to state that it is using green electricity; it has to be able to prove it. This is where Guarantees of Origin come into the picture.

Guarantees of Origin (GoOs) are certificates that ensure the electricity a company has purchased is green. A GoO states where, when and how the energy was produced. Once a specific GoO has been purchased, it is canceled and cannot be re-purchased. This guarantees that the amount of green electricity used equals the amount produced.

“When electricity is fed into the grid, it gets mixed. This means that in practice is impossible to tell whether you are using green electricity or not. Guarantees of Origin verify that the company has purchased green electricity and that the green electricity in question has been produced accordingly,” explains Portfolio Manager Mervi Leskinen at Gasum.

Gasum helps companies to navigate the market

To ensure that GoOs are used appropriately, they are regulated by a strict legislation at both a national and EU level. The current EU directive came into effect in 2018 and the national legislation based on the directive is already underway. However, since there is no exchange for GoOs, companies usually use advisors such as Gasum in purchasing them.

“The lack of an exchange means that there is no set price for different kinds of GoOs. That is why many companies need help in purchasing them. Gasum’s mission is to stay informed of the overall situation on behalf of our customers and find the most suitable GoOs and the best ways to acquire them,” says Sales Manager Tommy Sundin at Gasum.

Gasum has long experience in trading GoOs both with energy producers and customers using the energy. Gasum’s advisors have a broad knowledge of different products and a network of GoO counterparties.

Guarantees of Origin are not mandatory but a must

GoOs are not mandatory but there’s little point in a company going green if it can’t prove it. Without Guarantees of Origin a company cannot verifiably claim it is using green electricity.

In addition to PR and marketing, sustainability is important for Gasum’s customers also in terms of investors and green capital. Companies are also affected by the climate targets of their customers that require, for example, a certain proportion of electricity used by their partner’s to be green.

“At the moment every company has to think about how they can be low-carbon or achieve carbon neutrality. GoOs are an easy and reliable way to achieve this goal. Our customers don’t have to have deep knowledge of acquiring GoOs. We have it for them, and we can advise them for example on what energy source matches their needs and the message they want to get across to their customers, stakeholders, and the public,” says Mervi Leskinen.