The Electricity Certificate Market
Norway and Sweden have had a joint market for electricity certificates since 1 January 2012. The goal is to increase renewable energy production by a total of 28.4 TWh in both countries from 2012 to the end of 2020 and thus contribute to the countries' targets in relation to the EU Renewable Energy Directive. This represents the energy consumption of more than half of all Norwegian households
The energy producers receive one electricity certificate for each megawatt hour (MWh) of renewable energy produced , over a maximum 15 years.
The electricity certificates are sold in a market where prices are determined by supply and demand. In this way, the producers receive extra income in addition to the energy price.
Demand for electricity certificates arises in that energy suppliers and certain electricity customers are obliged by law to buy electricity certificates corresponding to a certain proportion (quota) of their calculation-relevant electricity consumption.
The electricity end users pay for thed development of renewable energy production because the cost of the electricity certificates is included in the electricity bills.
Every year, the market participants with quota obligations must cancel electricity certificates in order to fulfil their quota obligation.
The EU's Renewable Energy Directive sets binding national targets for the proportion of renewable energy. According to the Directive Norway is obliged to inrease their national proportion with 67.5% by 2020. The electiricy certificates system is the most important way of achieving this target. In addition, the system contributes to increased energy production which again gives Norway a strengthened supply security.