A European-wide harmonised tradable green certificate scheme for renewable electricity: is it really so beneficial?

Winds of change are blowing in the public promotion of renewable electricity (RES-E) in Europe. On the one hand, a move to allegedly more market-conform instruments for the promotion of RES-E has already taken place in some Member States. On the other hand, a Directive on the promotion of RES-E has recently been approved setting indicative targets for RES-E consumption and opening the possibility that a harmonised framework for support schemes will be implemented in Europe. This harmonised framework (in combination with trade in RES-E between Member States) can be compared to a situation in which Member States continue to apply their current support schemes. This paper analyses the pros and cons of harmonisation. The main conclusion is that if priority is given to the local/regional/national benefits of RES-E, then harmonisation in combination with a tradable green certificate scheme is not so advantageous for countries. Only if the policy priority is the achievement of the RES-E Directive targets at the minimum costs should harmonisation be favoured by national energy authorities.