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REGO rebound: Prices to rise on COVID recovery

Luke Ansell Analyst

We recently published the findings from the January 2021 edition of our Green Certificates Survey. The survey, which had 62 respondents from 59 distinct organisations, is designed to provide greater market transparency for Renewable Energy Guarantees of Origin (REGO), Continental Guarantees of Origin (GoOs) and Renewable Gas Guarantees of Origin (RGGO) certificate markets. The survey provides aggregated views on certificate pricing levels, demand and supply trends and sentiment on the future market trajectory. This ‘Chart of the week’ looks at survey participants’ latest views on REGO prices, as well as the evolution of prices since December 2019. Figure 1 compares the average response for current trading values for REGOs over Fuel Mix Disclosure (FMD) years 2020-21 and 2021-22 from our past five surveys. Pre-COVID, in our December 2019 survey, respondents reported average REGO prices of £0.66/REGO for FMD 2020-21 and £0.72/REGO for FMD 2021-22. However, the pandemic then saw demand for REGOs fall, due to an unprecedented drop in electricity demand. Meanwhile, renewables generation continued to rise as more projects commissioned, thus increasing the supply of REGOs. By the October 2020 survey, the average reported REGO trading price had dropped by 74% and 61% for FMD 2020-21 and FMD 2021-22 respectively. Following previous sentiment expecting a rise in prices, our latest survey shows that REGO prices have now slightly risen since our October 2020 view. The January 2021 survey has seen a 15% and 14% rise in reported average REGO values for FMD 2020-21 and 2021-22, to £0.20/REGO and £0.32/REGO respectively. Sentiment remained positive in January, ...

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