Green Certificates: How Businesses Are Shaping the Future of Clean Energy

The Terms You Need to Know

A green сertificate (also known as a renewable energy certificate or REC) is essentially a document that confirms a certain amount of electricity was generated using renewable or other low-carbon energy sources.

Under Russian legislation, one generation attribute corresponds to one kilowatt-hour (kWh) of electricity. Think of the REC as a kind of container that holds any number of these units. It records essential details like the date and volume of generation, the type of renewable energy used, and a unique identification number.

In Russia, these certificates are issued through the National Registry of Generation Attributes and Guarantees of Origin. This registry is managed by the Association called the "NP Market Council''.

While the International Renewable Energy Certificate System (IREC) is still the most trusted globally, Russia has adopted its national certification system since 2022. This one is designed to be more transparent and trustworthy and to better fit unique legal and market conditions in Russia.

Why Green Certificates Matter

For businesses, a certificate of origin for electricity is more than just a tool to lower their carbon footprint. It's also a way to strengthen their market position internationally. Here are some benefits.

1. Reducing carbon emissions. Companies use certificates to verify they consume carbon-neutral power generated from renewable sources.

   
   

2. Enhancing product appeal. Environmentally responsible production makes goods more attractive to buyers, especially in Europe and Asia, where carbon requirements are becoming stricter and demand for low-emission goods continues to rise.

   
   

3. Supporting non-financial sustainability reporting. Businesses typically get RECs as evidence of green energy purchases when calculating Scope 2 emissions.

   
   

4. Encouraging renewable energy progress. Each certificate contributes to the growth of new solar, wind, and hydroelectric projects by creating demand for clean power worldwide.

   
   

How to Purchase a Green Certificate

Not long ago, proving the purchase of green electricity in Russia was much more complicated because such certificates were not yet available as a tool. Today, the process has become simpler and more accessible for many businesses. A company aiming to increase the share of renewable energy in its consumption must meet a minimum entry requirement to register in the Low-Carbon Generation Attributes Registry.

Main Steps

1. Compliance Verification

The electric power-generating facilities are required to qualify to confirm the company uses renewable energy sources. These may include solar, wind, tidal power, biogas, or geothermal energy. The registry also records data on low-carbon sources like hydropower and nuclear generation. In Russia, they are considered low-carbon, even though they are not always regarded as clean energy in European countries. The choice of energy type depends on the company's needs and the requirements of its auditors.

2. Registration in the Certification System

The first step for a company is registering its renewable energy generation facility in the National Registry of Generation Attributes and Guarantees of Origin. This system is designed to manage and track renewable energy attributes and green certificates. It records data on electricity production, transmission, and consumption, ensuring transparency and reliability.

3. The Issuance of the Certificate

Once the facility is verified, the producer's account is credited with a volume of energy generation attributes equal to the quantity of generated electricity. When the attributes are transferred to a buyer, an official certificate of origin of energy is issued. This document confirms the buyer's right to use the associated attributes. It contains key details such as the energy source, the quantity of electricity produced during a specific period, the issuance date, and a unique identification number (UIN).

4. Purchasing and Using Green Certificates

Companies looking to reduce the carbon footprint of their electricity consumption can purchase green certificates directly from producers or through specialized resellers. Note that green energy certificates can be issued for any type of power that meets low-carbon generation standards. The choice depends on the company's sustainability goals and requirements. For instance, large-scale hydropower may not be considered renewable in some countries, and generation on NPPs is sometimes excluded from ESG reporting frameworks and standards, etc.

Please note that green certificates are valid for a limited period only. Those issued during a calendar year remain valid until March 31 of the following year. After that, they expire and are automatically removed from the registry.

Green Energy Global Market Overview

The market for energy attribute certificates is growing rapidly across the globe. So far, the most dynamic players are China and members of the European Union.

In the first half of 2024, China issued 486 million renewable energy certificates which are 486 million MWh of renewable electricity. The primary categories include:

• 197 million for wind power
  
• 133 million for solar power
  
• 102 million for hydropower
  

Demand for certificates quadrupled, with around 699 million kWh of green instruments produced in 2024 already sold. The key buyers are export-oriented companies that strive to reduce the carbon footprint of their products.

But the second half of 2024 brought an even stronger surge. According to China's National Energy Administration (NEA), the country issued a staggering 4.73 billion green energy certificates over the year which is 28.4 times more than in 2023.

The volume of "traded" certificates reached 3.158 billion, accounting for 66.71% of the total issued. This shows that a large share of EACs is purchased separately from electricity supply contracts, making them a more flexible tool for reducing carbon footprints.

The main volumes of generation were in:

• wind power — 1.941 billion certificates
  
• hydropower — 1.578 billion
  
• solar power — 827 million
  
• biomass thermal power plants – 381 million

This growth confirms China's increasing role in the global transition to renewable energy sources.

In the European Union, the popularity of green certificates is largely driven by strict environmental standards. The EU relies on the EECS (European Energy Certificate System), which oversees the issuance and circulation of Guarantees of Origin certificates across all member states. In 2023, the system issued over 1 billion MWh in RECs.

International Standards for Energy Certificates

EAC systems mentioned in RE100, GHG, CDP, and others include:

• North American RECs tracking systems (several regional systems)
• The European Energy Certificate System — Guarantees of Origin (EECS GO)
• The International Tracking Standard Foundation (formerly I-REC Standard)
• Tradable Instruments for Global Renewables (TIGR)

In addition to the schemes and EAC registries listed above, some countries across continents run their own national programs.

• Australia's Renewable Energy Target (national certification system)
• Brazil's RECS Brasil (based on the I-REC Standard)
• Hungary's MEKH (national registry)
• Japan's national green energy certification system
• South Africa's zaRECs

Other systems include:

• REC (US and Canada)
• Guarantees of Origin (aka GO, Europe)
• REGO (UK)
• T-REC (Taiwan)
• J-Credit, NFC, GEC (Japan)
• GEC (China)
• LGCs (Australia)
• NZECS (New Zealand)
• Korean national EAC system
• Indian national EAC system
• Tradable Renewable Energy Certificates (TREC)

Green Energy in Russia

The green energy market in Russia is actively growing, fueled by the launch of new certification systems and vital changes in legislation. That brings Russian businesses the opportunity to prove they use electricity generated from renewable energy facilities, which helps boost their environmental reputation.

A key step in this progress was the adoption of Resolution No. 2359 at the end of 2023. This decision made the process of issuing and circulating green certificates clearer and more streamlined. Also, since February 2024, Russia's national system for managing low-carbon energy certificates of origin has been fully operational. So far, 3 GW of renewable energy capacity has already been registered in the system.

"In 2024, over five months from February to June, 17 million MWh of renewable energy attributes were recorded. Some organizations purchase certificates for one-off events, while others plan to use them regularly. I believe this market has strong potential," said Maxim Bystrov, Chairman of the Board of the Association "NP Market Council".

The national accounting and trading system provides transparent data on energy production, ensuring that each certificate is used only once.

The demand for green attributes is expected to continue growing due to the following factors.

• International requirements related to the carbon footprint of exported and imported products, as well as requirements for the carbon footprint of equipment used in the construction of renewable energy facilities.
• Emerging support mechanisms such as subsidies, tax incentives, and financing schemes for businesses that plan to use electricity from renewable facilities.
• Lower credit rates, including those offered to companies that comply with ESG standards.
• Voluntary responsible consumption of green energy to reduce environmental impact, including by individuals.
• Greenhouse gas emissions management. Easier auditing within reporting frameworks (including ESG) when disclosing data on direct and indirect greenhouse gas emissions.

Why Green Energy Is Worth the Investment

• Reducing carbon taxes and contributing to the sustainable development of renewable energy. For exporters, it's a practical way to ease the financial burden of carbon regulations by lowering their Scope 2 emissions.
• Building a strong reputation. Taking part in environmental projects helps businesses build trust with customers and partners while strengthening a company's environmental profile.
• Enhancing investment appeal. Green projects are increasingly seen as a priority by investors who focus on long-term sustainability.
• Eco-labeling, including labels confirming electricity use from renewable sources, can improve the product marketability.
• Some international companies choose not to work with suppliers that don't consume green electricity.

By 2025, Unigreen Energy company and its technology partners aim to reach a maximum output of 2 billion kWh. A contribution like this meaningfully supports the country's clean energy development.

Key Findings

Green (energy attribute) certificates are becoming key instruments in combating climate change and advancing the transition to clean energy. Their role is rapidly growing both in Russia and globally — driving the expansion of renewable electricity generation and strengthening environmental standards in business.

By investing in green energy and supporting certificates, companies strengthen their market position and help set a new responsibility standard. In turn, establishing a national registry, streamlined certification procedures, and launching and supporting low-carbon projects set the stage for long-term market growth.