Granular Certificate Trading Alliance formed

The Granular Certificate Trading Alliance has been formed to develop a platform for trading and management of time and location-based carbon free energy attribute certificates.

The Alliance, which is being convened by the renewable trading platform LevelTen Energy, includes energy companies AES and Constellation as well as Google and Microsoft.

The solution, under development in partnership with the US financial exchange and clearing house Intercontinental Exchange, aims to enable energy buyers to easily source carbon free generated around the clock and to incentivise energy sellers to produce clean energy where and when it is most needed.

In addition to supporting LevelTen Energy’s development of a transaction infrastructure for granular certificates, Alliance members intend to be among the first group of users when the solution launches.

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As the solution scales, it is anticipated to help accelerate the energy transition through the decarbonisation of electricity.

“The Granular Certificate Trading Alliance is tackling the next challenge for the energy transition, which is driving carbon-emitting resources off the grid at all hours,” says Bryce Smith, CEO of LevelTen Energy.

“To achieve this goal we must, by definition, creatively re-deploy existing resources and creatively incentivise new carbon free energy generation to come online where and when it is needed most.”

Granular certificates are the next evolution of renewable energy certificates or ‘guarantees of origin’, which have been increasingly sought after by companies for clean energy procurements typically on an annual basis.

With granular certificates, the energy can be matched on a closer to real time basis – for the Alliance, hourly – and thereby better support corporate decarbonisation accounting.

The Alliance’s offering – one of a number of such ‘matching’ solutions that have been conceptualised in energy markets – is planned to include two components, a trading platform and a management platform.

The trading platform, which will be hosted by the Intercontinental Exchange, is expected to launch in 2024 and will connect carbon free energy buyers and sellers – including solar, wind, hydropower and nuclear generators and battery storage charged by carbon free resources – to enable them to trade granular certificates based on buyers’ preferred technologies and the time and location the electricity is generated.

The management platform, which is being developed by LevelTen Energy, is intended as a centralised hub for market participants including generators, energy buyers and project financers, to manage granular certificates before and after trades and is planned to include access to market data, custom reports to inform granular procurement strategies, as well as certificate tracking and settlement.