Green Certificates

What are Green Certificates?

The Green Certificate system aims to increase the use of renewable energy sources where it is the most cost-effective and eliminates the burdens of power transmission. Green Certificates, or Renewable Energy Certificates, represent proof that a certain portion of electricity has been produced with renewable energy sources. The number of the certificates is equal to the amount of electricity produced – the production of one Megawatt-hour (1,000 kWh) is worth one certificate.

A new way to support renewable energy

The importance of renewable energy sources in terms of reducing the emissions of energy production and the organisation of energy management is significant. Even so, renewable energy sources are still often less competitive than fossil fuels, which is why any increase in their use often requires various forms of aid and incentives. Traditionally, renewable energy sources have been supported with tax subsidies and investment and various forms of direct aid.

Green Certificates are a market-based way to promote the use of renewable energy sources in the production of electricity. The Green Certificate system separates electricity from the production’s environmental and other added value and sells them on different markets. The produced electricity is sold to the electricity market as “grey” electricity, while the production’s environmental added value and the other added value arising from the use of renewable energy sources is sold as Green Certificates.

Voluntary in Finland

In Finland, participation in the certificate trading is voluntary. When consumers want to support renewable electricity production, they can make an agreement on green electricity with their power company (examples include the Norppasähkö, Tuulisähkö and Ympäristöpenni options) or, alternatively, buy Green Certificates on the market.

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Page last updated 15.6.2017

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