Published on : 15 April 20203 min reading time
The system of energy saving certificates (EWC) was introduced by the POPE law: energy sellers must present EWCs attesting to the completion of energy saving work at their customers’ premises. As these certificates can be traded, a trade has been set up: market operators pay part of the cost of the work and obtain the EWCs themselves, which they sell to suppliers.
Energy trading policy
The programme setting the orientations of the energy policy establishes objectives and a national strategy for the control of energy consumption and the reduction of the environmental impact of this consumption. In order to encourage the implementation of actions aimed at improving energy efficiency, it establishes a new tool: energy saving certificates.
The idea is to make energy savings by consumers dependent on their own suppliers. It establishes a category of “obligated persons”: energy professionals who sell electricity or gas, motor fuel or heating oil, heat or cold to businesses and end consumers. These “obligated persons” must, under penalty of fines, obtain a certificate from the Ministry of Energy of the EEC attesting to the savings made. In concrete terms, they will help customers to identify potential actions to improve energy efficiency, and if these actions enable them to obtain EECs, they will help to finance them.
However, some of them do not want to participate directly in these actions or do not manage to achieve the objectives set for each three-year period of the scheme. They can therefore avoid fines by buying the EWCs they are missing. The potential “sellers” are not only bondholders who have exceeded their objectives, but also market operation ( energy trading) companies which have made a place for themselves on the EWC market.
The energy trading companies
The energy trading companies have set up a strategy to obtain EWCs directly themselves. They contact work companies and undertake to pay them themselves (partially or fully) for the work covered by the scheme. These companies will then approach private individuals and professionals and carry out the energy-saving work. Once the work has been completed, the energy trading company sends the certificates to the Ministry of Energy, and then receives the EWCs that it will sell to the obligated parties. It is therefore a set-up in which the obligated parties transmit their obligations and their task of giving priority to companies and customers to market operators, who then have access to the possibility of having the certificates validated.
The price of the services
It is reduced for the beneficiaries because it is partly assumed by the energy trading company, hence the interest of this arrangement. It also helps to stimulate the activity of the companies offering the various energy saving works (insulation of the building or hot water pipes, changing the lighting or heating system, etc.). It is also a very changing market, because to be the subject of EECs, the measures must not only contribute to reducing consumption but also appear on lists partly defined by order of the Minister responsible for energy. Types of actions may therefore from one day to the next become eligible or cease to be eligible. Energy trading companies constantly monitor these lists.
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