How to sell White Certificates on TGE?

What are White Certificates and how to obtain them?

White Certificates are a market-based mechanism to support investments that lead to energy savings in the company. This document confirms that a specific amount of energy saved as a result of modernization (e.g. replacement of lighting, thermal modernization, replacement of machinery or improvement of industrial processes) has been obtained. The value of the certificate is expressed in tons of oil equivalent (toe), where 1 toe corresponds to 11.63 MWh of electricity saved. In order for a company to obtain a White Certificate, it must meet procedural requirements that are difficult to meet without specialist experience, and simple formal errors may result in the rejection of the application. The key principles are:

• Pre-start notification: The application to the Energy Regulatory Office must be submitted absolutely before the start of the investment (e.g. before signing the contract with the contractor).
• Professional Audit: The application must be accompanied by an energy efficiency audit, which precisely calculates the planned savings. The investment must generate savings of at least 10 toe per year (about 117 MWh per year).
• Verification and reporting: After the completion of the investment, the ERO must be notified. If the savings exceed 100 toe, an as-built audit is required. Only after a positive verification does the President of ERO issue an energy efficiency certificate.

Step by step: How to cash in White Certificates on TGE?

In the Polish legal system, White Certificates are traded on the Polish Power Exchange (TGE). The exchange itself is only a market organizer and does not deal with direct trading. Here is the path that testimonies must travel to turn into cash:

Step 1: Creation of property rights. The ERO’s decision is just the beginning. Property rights arising from the certificate arise at the moment of its first entry in the account in the Register of Certificates of Origin (RŚP) maintained by TGE.

Step 2: Choosing an intermediary (Brokerage House). The company must operate through an intermediary – a Brokerage House that is a member of TGE. This requires the conclusion of specialist agreements for the maintenance of the Register of Exchanged Commodities and a cash account.

Step 3: Registration and Sell Order. The obtained certificates are recorded in the company’s account in the register, and then transferred to the account at the brokerage house.

Step 4: Transaction on the Property Rights Market (RPM). The client’s representative executes the sell order during the trading sessions. Demand is generated mainly by energy and gas companies, which are legally obliged to issue certificates.

Step 5: Financial settlement. After the transaction, the funds, minus the commissions of intermediary institutions, go to the brokerage account, and from there to the company account.

Cooperation with an expert – the optimal monetization path

Theoretically, each company can independently go through the procedure of obtaining and selling White Certificates. In business practice, given the workload and risks, this path is rarely economically justified. This process requires specialist knowledge and resources, which are usually only available to entities professionally related to the energy market.

The main challenges of self-implementation are:

• Rigorous verification by the Energy Regulatory Office: The Energy Regulatory Office subjects applications and audits to detailed control. Lack of experience in preparing documentation in accordance with the specific requirements of the office often leads to delays of several months or complete rejection of the application for formal reasons.
• Market access costs: The sale of property rights requires the intermediation of the Brokerage House. For an entity executing a one-off transaction, fixed account service costs and negotiating individual commission rates can significantly reduce the final profit. The scope of formalities resulting from establishing cooperation with a financial institution significantly prolongs the process of obtaining funds.
• Benefits of experience – market timing: Prices on the Polish Power Exchange are subject to fluctuations. The lack of ongoing access to market analyses makes it difficult to indicate the optimal moment of sale, which threatens to sell the rights below their potential market value.

The solution that eliminates these barriers is to entrust the entire process to a specialized consulting company such as Energy Solution. This model is based on the professionalization of each stage – from the identification of potential, through the audit, to the finalization of the transaction.

Why is cooperation with a professional consulting company the most advantageous solution?

• End-to-End: The company shifts the burden of bureaucracy and procedures to an external partner. This allows the company to focus on its operational activities, while experts manage the process before the Energy Regulatory Office, the brokerage house and the stock exchange.
• The “Success Fee” model: This is a mechanism that guarantees financial security. The advisor’s remuneration is due only at the time of the successful sale of the certificates and the acquisition of funds by the client.
• Economies of scale and knowledge: An experienced partner, who has been associated with the stock exchange for years, naturally has preferential conditions in Brokerage Houses. In addition, the ongoing analysis of trends on TGE allows experts to make sales at cost-effective moments, which maximizes the return on investment.

The decision to work with an expert is a choice of safety and efficiency. Instead of involving its own resources in complicated administrative procedures, the company can be sure that the process will be carried out effectively and the capital obtained will be maximum.

Summary

Recovering part of the investment outlays thanks to White Certificates is a real financial benefit, which, with the support of experts, becomes a simple and safe business process. At Energy Solution, we will comprehensively guide your company through every stage – from a professional audit and application to the Energy Regulatory Office, to the advantageous sale of property rights on the stock exchange. Contact us to convert energy efficiency into capital without unnecessary risk and bureaucracy.