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New system of Guarantees of Origin of Renewable Gases

On May 18, 2022, Royal Decree 376/2022 (“RD 376/2022”) was published, which regulates the sustainability criteria and the reduction of greenhouse gas emissions from biofuels, bioliquids and biomass fuels, as well as the system of guarantees of origin of renewable gases.

The need to establish this system has its origin in Directive (EU) 2018/2001 of the European Parliament and of the Council, of December 11, 2018, regarding the promotion of the use of energy from renewable sources. Countries like France, Holland or Italy have already transposed this directive with the creation of different platforms.

Likewise, at the national level, Law 7/2021, in the National Integrated Energy and Climate Plan (PNIEC), as well as in the Hydrogen and Biogas Roadmaps, stated the need to regulate this system. Until now, the only thing that is in operation is the UNE 0062:2020 specification of guarantees of origin for biomethods, created by Sedigas and the Spanish Association for Standardization, UNE.

In order to partially transpose Directive (EU) 2018/2001, Title II of RD 376/2022 includes the regulation of a system of guarantees of origin for gas from renewable sources. However, it will not be launched until six months after the publication of the Management Procedure by the Ministry, with the specification of the most technical and procedural issues.

Although it is established that the Ministry for Ecological Transition and the Demographic Challenge will be the Entity Responsible for the development and management of the system, given that it does not have sufficient resources, this function is designated to the Technical Manager of the Gas System (ENAGAS). The responsible entity must also report on the operation and management of the system to the Committee, which will be constituted for this purpose by representatives of the responsible entity, CNMC, as well as producers, transporters, distributors and renewable gas suppliers.

The guarantee of origin of renewable gas is defined as that electronic document, issued to the owner of a renewable gas production facility, which ensures that a certain amount of gas has been produced, from renewable sources, in a certain period of time.

For its part, gas from renewable sources or renewable gas is understood as fuel gas from renewable sources, applicable to renewable hydrogen, biogas and any other gas of renewable origin that is established as such.

Renewable gas production facilities must be duly registered in a Register of gas production facilities from renewable sources. The owners of the facilities or third parties acting on their behalf may manage said guarantees.

A unit of energy produced of 1MWh will be equivalent to a guarantee of origin of renewable gas. The guarantees must be valid for all the renewable gas produced (in the case of self-consumption they will be self-cancelled and not subject to transfer) and will be valid for 12 months from the date of production, 18 months after production, the guarantees will not redeemed will expire. GoO will be exportable to other EU Member States, and the constitution, issue, transmission, import, export and cancellation of a GoO will be reflected in the system’s book-entry account.

Regarding the benefits for producers of renewable gas, it is an additional flow of funds that they will receive in order to reduce production costs. As it is already being seen in other states, this flow depends on different variables, among which we can highlight:

  • Type or quality of renewable gas (hydrogen, biomethane, biogas or others).
  • Possibility of import/export with other states.
  • Specific regulation of each state, specifically in terms of state financing.

An example of the price disparity are the prices of biomethane GoO, which in the Netherlands or Denmark can reach a price ten times higher than what is paid in France, due to internal French regulation.

The level of progress of the states is very uneven and consistency between systems is scarce, although harmonized systems of guarantees of origin have already been developed for both hydrogen and biomethane in order to advance in standardization at a European level.

Given that renewable gases can contribute to the decarbonisation of the economy in those uses whose electrification presents greater technical or economic difficulties, a System of guarantees of origin that accredits the use of renewable sources constitutes a mechanism to stimulate deploying renewable gases. However, development of regulation and its effects on market flows are still pending.

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