Gain without pain: an international case for a tradable green certificates system to foster renewable energy development in Ukraine

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This paper elaborates on the theoretical and methodological fundamentals of a tradable green certificates system to foster renewable energy development in Ukraine. It proposes a management mechanism premised on the classical market model of tradable green certificates aiming at increasing the share of electricity from renewable energy sources in the country’s energy mix. Organizational stages of the mechanism formation at the national level and a methodological approach to assess green electricity generation cost are developed. The modeling has shown that the annual increase in the cap for green electricity consumption by 1% will raise the electricity tariff by 3%, which is not a significant financial burden for consumers. The proposed changes in the tradable green certificates system can be an effective management tool to achieve the required amount of electricity from renewable energy sources in the country’s total electricity consumption and to foster the development of the Ukrainian renewable energy sector.

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    • Figure 1. The wholesale and retail electricity markets operating scheme with combination of electricity sold by the feed-in tariff and a TGCS
    • Table 1. The LCOE and the GC price for different types of RE plants in Ukraine
    • Table 2. Number of GCs that producers of electricity from different types of RES would have obtained per 1 MWh and cost of electricity generation from RES
    • Table 3. Projected annual amount of electricity generation by the operating RE plants; projected annual amount of electricity generation supported by credit GCs; and the average weighted number of certificates in circulation in the reporting year