Guarantees of electricity origin as a financial mechanism to increase investment attractiveness in the energy sector

Abstract

In modern environment, ensuring the development of the renewable energy sector is significant for achieving the country’s sustainable development goals. The introduction of a mechanism for guaranteeing the origin of electricity is one of the most effective ways to develop renewable energy, and therefore its study is relevant. The purpose of this study was to analyse the approaches to the functioning of the market of guarantees of electricity origin in the EU countries and compare them with the situation in Ukraine. The principal methods of the study were forecasting (prospects for the implementation of energy origin guarantees in Ukraine) and comparison (approaches to the formation of the mechanism of energy origin guarantees in Ukraine and the EU). The study noted the overall role of renewable energy for the development of any country and Ukraine specifically. All the main positive components that arise in countries in the development of this area were described in detail. The instrument of guarantees of energy origin stays effective for achieving the goals of renewable energy development in Ukraine. Considering the specific features of the rules for selling renewable energy guarantees, the study concluded that they are useful both for stimulating the development of the sector and for disseminating information about the need to improve the state of the renewable energy sector in Ukraine and globally. The study assessed what steps has Ukraine taken to adopt and implement this mechanism. Information on EU countries was also examined. The gradual increase in demand for such instruments every year since 2019 indicates not only the popularity of this practice, but also its need among all market players. It was shown that, after the start of Russia’s full-scale invasion of Ukraine, the foreign trade balance turned negative, i.e., the volume of electricity purchases exceeded the volume of sales. The findings of this study can be used to formulate a long-term strategy for the development of a mechanism for guaranteeing the origin of electricity in Ukraine by public authorities