Renewable Energy Guarantees of Origin (REGOs) prices are on the rise, according to the latest results from Cornwall Insight’s Green Certificates survey. In fact, reported average REGO prices have increased for Fuel Mix Disclosure (FMD) years 2020-21 up to 2023-24, with averages up to 50% higher than the January 2021 survey. However, prices are yet to recover to pre-pandemic levels.
The independent survey of 58 organisations across the industry ran from 20 April to 6 May. Market sentiment was broadly positive. 57% of respondents felt that REGO prices would rise further in the next year.
Commenting on the survey results, Luke Ansell, Analyst at Cornwall Insight, said:
“Demand outlook was also positive among participants, with 64% reporting increased demand for REGO backed supply products in the past three months. As well as citing end-of-year supplier buying, uncertainty surrounding the future acceptance of European Guarantees of Origins (GoOs) and greater climate ambition from businesses as bullish demand drivers.
“Demand has increased across all sectors of the market, with the survey respondents reporting the biggest demand increases from large industry and corporates.
The positive sentiment for REGO growth is set to continue, with many expecting further price rises over the next year due to electricity demand returning to pre-covid levels. 11% of respondents are expecting a strong upward trend in price.
“During the survey, we asked participants if they traded REGOs alongside power in Power Purchase Agreement (PPA) deals. 59% of respondents said they had purchased REGOs and power in PPAs at least occasionally. At the same time, the same percentage indicated there was no price differential between REGOs traded within PPAs and REGOs traded.
“23% of respondents had entered into corporate PPA (CPPA) deals, of these, half felt that provision of REGOs was very important to the customer, while three quarters considered technology type of REGOs very important to corporate customers.
“Though participants to January’s survey also suggested that REGO market reform is necessary. With calls for more specific reforms to transparency, an overwhelming majority, at 74%, felt there had been no improvements in transparency in the last three months.”
