Market Operator proposes including guarantees of origin in CBAM – director general

Ukraine's Market Operator is working on incorporating Guarantees of Origin (GOs) for renewable energy into the Carbon Border Adjustment Mechanism (CBAM) for regulating carbon emissions at the EU's borders, according to the company's director general, Oleksandr Havva.

"Electricity in CBAM is considered both as a product and as part of indirect emissions. GOs can be included in calculating the actual emissions coefficient for electricity imports into Europe. This will provide an additional source of income for renewable energy producers, allowing them to expand generation and attract investment," said Havva during the Energy Day 2024 event in Kyiv.

GOs could also be included in calculating indirect emissions in product manufacturing under CBAM, although current regulations do not permit this.

"This will benefit both product manufacturers and renewable energy producers. According to the current CBAM version, a product manufacturer must either be directly connected to a renewable energy installation or have a direct power purchase agreement to use the actual emissions coefficient. This creates challenges for manufacturers due to financial, geographical, and market constraints," said Havva.

The inclusion of GOs in CBAM aligns with the EU's Green Deal objectives, considering the integration of renewable energy certification with carbon pricing mechanisms.