The Client

The client is a privately owned Australian company which produces and distributes poultry products throughout the country. The company is one of Australia’s largest poultry processing companies, and has a vertically integrated model, meaning they control and manage production process from start to finish.

The Project

The client is a large energy user with a correspondingly large GHG emissions footprint. This means that they are likely to be impacted as the state, national and global economies transition to net zero emissions over the coming decades. The company has already noted that these impacts are already starting to be felt, in particular from supply chain pressures from their major customers, who have made public net zero emissions commitments and are therefore requiring their suppliers to provide information on their current emissions and their emissions reduction plans. In order to ensure business continuity and profitability during this transition to a net zero emissions world, they recognised the need to prepare a corporate carbon emissions reduction strategy.

Our Role

Northmore Gordon developed a Corporate Carbon Emissions Reduction Strategy for the client, including:

• Identifying strengths and gaps in the client’s current approach to managing carbon emissions;
• Conducting a series of workshops with a range of stakeholders across the organisation to review key carbon management concepts and frameworks, including the Greenhouse Gas Protocol, Science Based Targets initiative (SBTi), Climate Active, and the Task Force on Climate-related Financial Disclosure (TCFD)
• Establishing a baseline carbon emissions footprint, covering all relevant scope 1, 2 and 3 greenhouse gas emissions
• Identifying opportunities to reduce carbon emissions across the organisation;
• Modelling various emissions reduction pathways, including Marginal Abatement Cost Curves (MACC);
• Defining emissions reduction targets with timeframes and implementation pathways
• Developing engagement tools to communicate the strategy internally and externally

The Outcome

“With Northmore Gordon’s help we were able to establish a carbon footprint and develop a strategy, we can now share to our key stakeholders and most importantly our customers. We believe it is our responsibility to work in a manner that reduces harm to the environment and had already been doing a lot to reduce our impacts. We are now able to set ambitious targets, understand our footprint and collaboratively work together with our customers and suppliers towards zero emissions.”

For more information contact: c.morgan@northmoregordon.com

The post Poultry Client Set to Hit 2030 & 2050 Carbon Emissions Targets appeared first on Northmore Gordon.

The Client

Greenham is a large-scale family-owned livestock business with three sites across Australia; Smithton (TAS), Tongala (VIC), and Moe (VIC). Rising energy costs and the need for alternative energy sources encouraged them to seek an energy expert to develop an end-to-end energy and carbon management strategy.

How We Helped

• Renewing annual data
• Energy productivity audits
• Cogeneration support
• Carbon credit monetisation and government grants
• Energy and carbon reporting
• Energy efficiency certificate creation

The Challenge

Greenham is a large-scale family-owned livestock business with three sites across Australia; Smithton, Tongala, and Moe. Rising energy costs, ageing infrastructure, and the search for alternative energy sources encouraged them to seek an expert to help them with their energy and carbon management strategy.

The Process

Smithton

Northmore Gordon was first engaged in 2014 to assist with a switch from coal to renewable biomass in the boiler at the Smithton site. Northmore Gordon registered the project for carbon off sets through the Emissions Reduction Fund (ERF), negotiated sale of off sets to a buyer, and submitted the first off sets report. Knowledge of measurement and verification methods in the Carbon Farming Initiative enables Northmore Gordon’s Energy and Carbon Performance Consultants to create Australian Carbon Credit Units (ACCU) every year, delivering a total of over $175K of value to Greenham. This involves intensive data analysis, modelling, liaising with the Clean Energy Regulator, participating in ACCU Auctions, and negotiating with buyers on the secondary market.

Further to the creation of ACCUs, Greenham was investigating a replacement for their biomass boiler which was nearing the end of its life. Northmore Gordon prepared a detailed specification of the new boiler and identified capable supply and installation contractors. A new state-of-the-art model is now operating at 15-20% greater efficiency, leading to a fuel cost saving of $50K per annum.

Tongala

Following the work at Smithton, Greenham was interested to assess the viability of embedded solar PV at Tongala. Northmore Gordon performed a solar feasibility analysis and investigated the suitability of a 2MW solar farm quoted by an external supplier. With complex electrical and thermal systems it was determined that other options should be investigated before proceeding. Subsequently Northmore Gordon performed an energy audit to provide a comprehensive review of the facility’s energy performance and renewable energy generation options. Although solar was considered, the audit revealed that cogeneration powerfully aligned with the energy profile and needs of the business. Funding through Sustainability Victoria supported the cost of the audit.

There were 15 potential areas of optimisation around the site, which would provide an estimated cost savings of $1M per annum. Greenham wished to further investigate three of these areas, upgrading the hot water system, cogeneration and conversion to High Voltage supply. These stand-alone business cases required further engineering design work and engaging suppliers. Greenham progressed with the cogeneration opportunity, which would also help alleviate hot water complications. Northmore Gordon also identified that cogeneration could be funded under a government grant, and Victorian Energy Efficiency Certificates (VEECs) could be created based on the energy savings. The grant was secured and the project registered for VEECs, improving the business case. The final design included 2MW of cogeneration units running off natural gas and biogas captured from the wastewater treatment system. This will provide electricity and hot water to the site and will augment the existing gas-fired hot water heaters.

Outcome

Greenham is now positioned as a leader in energy and carbon performance in the livestock processing sector and there are even more opportunities to improve. By entrusting Northmore Gordon to help improve carbon and energy performance, Greenham has drastically reduced energy costs, reduced greenhouse gas emissions, and improved energy productivity at their sites. Northmore Gordon worked extremely hard to unlock funding to help finance energy productivity and decarbonisation projects. This has been achieved through the annual creation of ACCUs at Smithton with a final value of over $175K. At the Tongala site the cogeneration project NG has been able to generate over $4.5M in total for Greenham from an upfront grant and from the VEU program for project implementation.

With the help of experts, you can help transform your energy performance and dramatically reduce costs.

For more information contact: c.morgan@northmoregordon.com

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“Northmore Gordon worked alongside the boiler installation company as well as AJ Bush Manufacturing to complete the project. Northmore Gordon went above and beyond to get the project done and were able to work under difficult circumstances to make sure AJ Bush Manufacturing was able to access the credits for this project.”- Nick Lawrance – Plant Engineer

The Client

AJ Bush & Sons (Manufactures) is Australia’s largest east coast protein recovery provider operating rendering and manufacturing plants in NSW and QLD. The plants specialise in processing animal by-products for the meat/butchery industry. The NSW (Riverstone) plant’s collection area, in addition to Sydney Metro, ranges from Nowra in the south to Canberra, Dubbo and Bathurst inland and up to Newcastle and Tamworth in the north. The material collected is recycled into products used for livestock, pet food, aquaculture, fertiliser and biofuels.

Key Facts

Equipment Upgraded: Gas-fired boiler (50y.o originally oil-fired)
Annual Energy Savings: 11,790 GJ p/a Opex: > $80,000
Certificate Value: $120,000
Project Payback Period: 15 Years
Program: NSW Energy Savings Scheme
Method: Installation of High-efficiency Appliances for Business (IHEAB)

The Project

AJ Bush Manufacturing Plant (NSW) operates 24/6 processing red meat and poultry by-products, making it extremely important that the boiler runs reliably and efficiently. An earlier energy audit in the plant identified a number performance improvements and highlighted the advantages of a boiler replacement. The plant had already made a number of services and repairs but it was determined the boiler was at the end of its serviceable life and the decision was made to replace the unit. The upgrade from the 7.3MW boiler to a new 10 MW boiler for extra capacity included many efficiency options including an economiser, oxygen trim, electronic air/gas ratio, and automatic TDS blowdown. Northmore Gordon is a leader in environmental certificate creation and trading. We have created the most certificates of all Accredited Persons under the Victorian Energy Upgrades program, an Accredited Certificate Provider in the NSW Energy Savings Scheme, and registered agent under the Federal Renewable Energy Target.

Challenges

Project was completed and done in conjunction with production as AJ Bush operates 24/6

Outcomes

7.3MW Gas boiler was replaced with 10MW boiler

Our Role

Northmore Gordon were engaged during the specification of the boiler and were able to calculate the value in energy saving certificates for various options (such as the economiser and blowdown controls). Working under Northmore Gordon’s direction AJ Bush collected much of the evidence required to meet the NSW ESS program requirements. In addition Northmore Gordon provided a price hedge to protect against adverse changes in the certificate price during the finalisation of the claim and the audit process.

The post AJ Bush & Sons reduces energy costs with needed upgrade appeared first on Northmore Gordon.

About Molycop

Molycop is the largest and most experienced manufacturer and supplier of grinding media to mining operations worldwide. Molycop is striving for greater sustainability through superior resource efficiency and defining a new standard of environmental performance.

How we helped

Since 2006, the Northmore Gordon Newcastle team has helped Molycop achieve annual energy cost savings and maximise their return on investment in energy projects through:

• Energy management strategy
• Energy audits
• Project development support
• Grants and funding options
• Energy and carbon reporting
• Energy and carbon certificates

The Challenge

Molycop is the largest and most experienced manufacturer and supplier of grinding media to mining operations worldwide. Whilst energy has always been important, and compliance with regulation critical, the Waratah site has since expanded its focus to form a long-term goal of decarbonisation through an end-toend energy strategy.

With over 20 years of experience and extensive knowledge in the steel sector, Northmore Gordon was selected to help Molycop develop their comprehensive portfolio of energy projects. Northmore Gordon consultants worked closely with the client’s energy and operations teams to investigate their processes and identify opportunities for improving efficiency. More recently, Northmore Gordon’s Energy and Carbon experts have been assisting Molycop to plan towards a low carbon emissions steel-making process.

The Process

Northmore Gordon adopted a systematic approach to identifying and prioritising energy and carbon management opportunities. This included investigating capital projects, low cost process improvements, government funding and revenue from energy and carbon certificates.

Our Energy and Carbon Consultants helped Molycop access over one million dollars worth of revenue through the NSW government’s Energy Saving Scheme and capital grants. Northmore Gordon also assisted Molycop in their purchasing of renewable energy through a corporate Power Purchase Agreement.

Some projects that have been implemented include:

• Installing Variable Speed Drives on large fans and pumps, including high voltage motors
• Modifying controls on fume extraction and cooling systems
• Improving yield
• Improving furnace controls
• Reducing pilot flame gas consumption
• Upgrade bag house
• Improving furnace heat recovery system
• Installing heat recovery on ladle preheating equipment
• Cooling tower upgrades

Outcome

Through Northmore Gordon’s multi-disciplinary approach, Molycop’s energy savings has grown to over $1.5M per annum. The consequential reduction in Greenhouse gas emissions has resulted in 15K tonnes of corresponding carbon emissions abatement each year. This has resulted in over $12M in energy costs and certificate revenue over the course of the project.

Do you need help developing a decarbonisation strategy? Contact: c.morgan@northmoregordon.com

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Interested to know more about moREnewable100 and the benefits to your business, please complete and submit the form here or contact Sid Bansal – Corporate Decarbonisation Manager.

When it comes to renewable energy procurement, the landscape can be complex. At Northmore Gordon, we make it simple and strategic. Unbundled International Renewable Certificates (RECs) allow businesses to credibly claim renewable electricity use, regardless of their location. Let’s break down how we help clients navigate this process with confidence.

Understanding Bundled vs. Unbundled RECs

RECs can be bundled with physical electricity supply or unbundled, sold separately from electricity. Unbundled RECs offer flexibility, allowing companies to procure renewable energy attributes independent of physical power contracts.

moREnewable100: A Cost-Effective Solution

Businesses with global operations face challenges in reducing Scope 2 emissions across diverse regions. Thanks to unbundled RECs and Power Purchase Agreements (PPAs), companies can now access renewable energy affordably and flexibly.

What Is moREnewable100?

moREnewable100 involves purchasing unbundled RECs to match electricity consumption across locations. Benefits include:

• Ensuring compliance with sustainability targets
• Accessing renewable energy globally at competitive rates
• Avoiding upfront capital investment
• Maintaining flexibility across jurisdictions
• Flexible single or multi-year contracting for certainty
• Fast to deploy
  
  

moREnewable100: A Global Decarbonisation Strategy

Unbundled RECs enable multinational companies to match consumption with renewable generation, even where onsite renewables or PPAs aren’t feasible. Northmore Gordon recently assisted a leading financial services company in covering its Australian and international offices, reducing Scope 2 emissions to zero efficiently.

Key Considerations When Buying RECs

Our guide on “Decisions to Make When Buying RECs” highlights:

• Geographic Matching – Aligning purchases with operational locations.
• Certification & Credibility – Ensuring RECs meet recognised standards.
• Cost Optimisation – Leveraging market trends for competitive pricing.
• Impact Transparency – Demonstrating contributions to renewable investment.
  
  

Origination and Sale

Companies generating surplus renewable electricity can monetise their energy attributes. Northmore Gordon facilitates EAC registration and market placement, ensuring optimal pricing. Through our Singapore office, we originate I-RECs for projects in Singapore and Asia, with access to global REC markets and surrender capabilities to meet sustainability goals. In Australia we originate LGCs for domestic and international customers to surrender.

Benefits of Unbundled RECs

Unbundled RECs offer businesses:

• Global Accessibility – Procure RECs worldwide to support clean energy.
• Credible Sustainability Claims – Ensure carbon reduction goals are met.
• Cost Savings – A lower-cost alternative to physical renewable projects.
• Enhanced Reputation – Strengthened brand perception among stakeholders.
• Revenue Opportunities – Monetising
  
  

With REC prices declining globally and Australian LGCs dropping 50% from a year ago, now is the time to optimise your renewable energy procurement strategy.

Risks of Inexperienced Providers

Partnering with an inexperienced REC provider can lead to:

• Regulatory Non-Compliance – Risk of penalties due to improper procurement.
• Financial Loss – Overpaying due to poor market knowledge.
• Market Instability – Procurement timing mistakes leading to higher costs.
• Poor Documentation – Hindering sustainability reporting and making audits more challenging.
• Missed Revenue – Misjudging market conditions, leading to lower-than-expected returns from REC sales.
• Fraud Risks – Not all low-cost RECs are fraudulent, but double counted RECs are.

Why Choose Northmore Gordon?

With deep expertise in energy markets and sustainability consulting, Northmore Gordon simplifies REC transactions, ensuring businesses achieve renewable energy commitments efficiently.

For companies with global operations, unbundled RECs provide a scalable, cost-effective solution for reducing Scope 2 emissions. Contact us to explore tailored solutions that align with your sustainability and financial objectives.

Northmore Gordon has access to a wide range of RECs, including I-RECs, TIGRs, RECs, REGOs, GOs, LGCs, NZECs, J-Credits, and more.

Disclaimer: The information in this article is general only and has been prepared without considering your business’ particular circumstances and needs. You should assess or seek advice from Northmore Gordon Environmental (AFSL 533927) on whether it is appropriate for your business’s objectives.

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The William Inglis Hotel, a 144-room boutique hotel in Warwick Farm, NSW, operates 24/7 alongside the Inglis Auction House. Rising energy costs and a commitment to sustainability led General Manager Belinda Thomson and the Inglis board to explore solar energy solutions.

To maximise both financial and environmental benefits, William Inglis Hotel partnered with Smart Commercial Solar for a tailored rooftop solar installation and Northmore Gordon to leverage Large-Scale Generation Certificates (LGCs) for additional returns.

The challenge

• High energy costs from continuous operations.
• Significant electricity demand for air conditioning and lighting.
• Commitment to sustainability without disrupting operations.

The solution

William Inglis Hotel installed a 496 kW rooftop solar system across four stable buildings. Northmore Gordon facilitated project registration under the LGC scheme, enabling the hotel to generate and trade renewable energy certificates, further enhancing financial returns.

The outcomes
Since installation, the hotel has achieved:

• 30% reduction in energy consumption, lowering costs
• 450 tonnes of CO2 emissions avoided annually
• A strong financial return through LGC revenue

Looking ahead

Encouraged by the project’s success, William Inglis Hotel is considering solar expansion. With Northmore Gordon’s expertise, the hotel will continue optimising its sustainability strategy for long-term cost savings and environmental impact. Belinda Thomson, General Manager, states: “Smart Commercial Solar and Northmore Gordon made this a seamless transition, helping us maximise savings and sustainability benefits.”

Nick Blacklock, Smart Commercial Solar, adds: “This project showcases how solar and environmental
certificates work together to create both immediate and long – term value.”

The benefits
By leveraging the LGC scheme, William Inglis Hotel has reduced its payback time and reinforced its leadership in sustainable hospitality. Northmore Gordon continues to ensure the system delivers maximum value, proving that energy optimisation and environmental certificates go hand in hand.

Northmore Gordon’s services
Northmore Gordon provides expert support to businesses looking to optimise energy efficiency, reduce emissions, and maximise financial returns through environmental certificates.

Our services include:

• Power Station Registration: Managing Clean Energy Regulator requirements, including paperwork, methodology development, and technical queries. Registration fees can be deducted from LGC revenue, ensuring no upfront cost
• Environmental Certificate Management: Quarterly data validation, LGC calculation and creation, compliance with regulators, and aggregation/trading of registered LGCs
• Carbon and Renewable Energy Strategy: Measuring carbon footprints (Scope 1, 2, and 3), identifying emissions reduction opportunities, and building tailored decarbonisation roadmaps
• Accreditation and Compliance Support: Assisting with programs like Australian Climate Active, RE100, Science-Based Targets Initiative (SBTi), and CDP
• Carbon Offset Acquisition and Retirement: Helping businesses meet emissions reduction goals through verified carbon and renewable energy offsets
  

Northmore Gordon partners with businesses to turn sustainability commitments into measurable financial and environmental gains.

For more information about Solar VEECs and LGCs contact: Madonna Ghajar

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Key Findings and Opportunities

The report underscores the substantial impact of energy efficiency, revealing that it can contribute up to 18.5% of the emissions reduction Australia requires by 2030 and 13.5% by 2050, according to the independent modelling provided by Northmore Gordon. With over two million small businesses in Australia, representing nearly a third of the country’s GDP, there is a tremendous opportunity for SMEs to curtail energy consumption and support Australia’s net zero emissions goal.

Strategic Recommendations

Energy efficiency is identified as the most cost-effective initial step for SMEs. The report also highlights electrification and renewables as critical components of energy upgrades. Clare Morgan, ANZ Group Executive for Australia Commercial, emphasizes the importance of prioritising energy efficiency, especially amid rising material and energy costs. She notes that businesses acting now can save money, reduce emissions, meet growing sustainability expectations, and enhance business resilience.

Luke Menzel, CEO of the Energy Efficiency Council, points out that energy use in businesses, homes, and vehicles is responsible for about 80% of Australia’s emissions. With the nation’s energy transition plan becoming clearer, now is the time for businesses to harness energy efficiency.

Comprehensive Approach

The report, part of ANZ and EEC’s “Forgotten Fuel” series, follows the inaugural May 2023 publication, “Putting Energy Efficiency to Work.” This series illustrates how energy efficiency and electrification are vital for lowering energy bills and decarbonizing the Australian economy.

Three key highlights from the current report include:

• Critical Tools: Energy efficiency, electrification, and renewables are indispensable for SMEs aiming to reduce energy bills and emissions.
• Impactful Modelling: Independent analysis by Northmore Gordon, commissioned by ANZ and the EEC, finds energy efficiency can deliver up to 18.5% of the needed emissions reduction by 2030.
• Integrated Solutions: Combining energy efficiency with electrification can achieve nearly 40% of the emissions reduction required for Australia, surpassing the impact of renewable electricity alone.

How Northmore Gordon Can Help

We are committed to helping businesses realise the potential of energy efficiency. We provide expert guidance and solutions to implement these critical upgrades, leveraging both corporate and government funding opportunities. By partnering with us, businesses can navigate the complexities of energy efficiency and make meaningful strides toward sustainability and cost savings.

For more information on how to enhance your business’s energy efficiency and unlock funding opportunities get in touch below.

Images sourced from: ANZ’s Putting Energy Efficiency to work for Business Report – May 2024

The post Press Release: Northmore Gordon’s Modelling Underpins ANZ and EEC Report on Business Energy Efficiency appeared first on Northmore Gordon.

The executive summary of the treatment of registered certificates: 

Businesses wishing to claim renewable energy or emissions reductions from project-generating certificates need to adhere to the following rules. If the business does not make the claims they are free to sell the certificates or use them in other ways.

1. Renewable Energy Certificates (LGCs) must be surrendered to validate that a business is using renewable energy (see 5 for the exception). 

2. Australian Carbon Credit Units (ACCUs) must be surrendered to validate emission reductions from specific projects (see 5 for the exception). 

3. Small-scale Technology Certificates (STCs) provide an immediate discount on solar systems cost and the business will be able report lower grid-based emissions.   

4. Victorian Energy Efficiency Certificates (VEECs) and Energy Saving Certificates (ESCs) lead to immediate energy savings and reduced Scope 2 emissions.  Selling VEECs or ESCs has no impact on the emissions reductions. 

5. There are arbitrage opportunities to sell LGCs or ACCUs and buy other recognized Environmental Certificates or Carbon Credits to surrender, which can be financially advantageous. 

6. Businesses can sell VEECs and leverage the proceeds to buy and surrender LGCs or ACCUs, resulting in greater emissions reductions than just the original VEEC project. 

The Northmore Gordon carbon advisory team has extensive knowledge in navigating the treatment of domestic and international certificates within programs such as NGERs, Climate Active, Science-Based Target Initiative (SBTi), Corporate Emissions Reduction Transparent (CERT) report, RE100, and others. It equally applies to companies with decarbonisation targets or voluntary targets conforming to Greenhouse Gas (GHG) Protocol.  This understanding allows us to maximise the monetary value whilst still meeting emissions reduction targets. 

 
Environmental Certificates assist in different ways

I have a corporate target for renewable energy purchases 

1. Can I use VEECs to demonstrate renewable energy purchases? 

VEECs are not a Renewable Energy Certificate, instead they represent the energy savings. 

VEECs are calculated on energy savings, and then converted to a tonne of CO₂e using factors set by the Victorian Government. For some processes (methods) under the VEEC scheme, a user can claim VEECs from energy savings that are forward created for the next 10 years with a discount factor and based on assumptions about the greenhouse gas intensity of the future grid. Hence it is difficult to demonstrate compliance with international GHG reporting standards that VEECs can be retired and used directly against a renewable energy purchase target.  

2. Buying LGCs in Australia using money from sale of VEECs  

For those companies aiming to achieve renewable electricity targets that comply with GHG Protocol Scope 2 guidance for emissions reductions, retiring LGCs or IRECs would be required. 

A company may sell VEECs, and this would help to fund the purchase of Renewable Energy Certificates.  It is recommended to begin the purchase and retirement of RECs in advance of any corporate target dates (e.g. 6 months) to ensure that any claims can be supported by the publicly available register. 

Due to price differences, the total quantity of RECs purchased won’t be the same as the number of VEECs sold.  

3. Buying RECs from the global market using money from sale of VEECs 

Whilst LGCs are solely acknowledged in Australia, companies with international operations, may purchase international RECs. These can be more cost effective than buying LGCs, increasing your renewable energy percentage in your global footprint. 

RECs are a globally recognised mechanism to demonstrate renewable energy purchases. They empower a company to demonstrate its utilization of 100% renewable energy, decarbonize its supply chain, fulfill certification criteria for products, buildings, or companies, and enhance climate-related disclosure standards. There are many different REC types and registries, and knowing which ones to buy and how much to pay can be challenging.  

International RECs are currently trading at both higher and lower prices compared to LGCs, depending on the country. Having a strategy in place helps you to optimise the amount of renewable energy per dollar spent. 

I have a corporate target for carbon and need carbon offsets 

4. Buying Carbon Offsets  

Purchasing carbon offsets can mitigate emissions that can’t be avoided by other means. They may also be needed for compliance – for example to meet the Safeguard Mechanism in Australia, to ensure you maintain Climate Active Accreditation, or to reduce the cost of a Carbon Tax (e.g. in Singapore). Alternatively, they could be voluntarily retired such as for Scope 3 emissions from employee travel.  

Carbon offsets are created from both avoided emissions and removals and are available from the Australian and international markets. in Australia, Australian Carbon Credit Units (ACCUs) represent a tonne of CO2-e that can be traded on the wholesale market, voluntarily surrendered to offset emissions, or sold against government contracts through auctions. Internationally, there are several registries and rating systems that are used to create high quality offsets such as Verra, Gold Standard, and Puro. Earth.  

Price and Quality are key considerations when purchasing carbon offsets. The following factors are some that should be considered: 

• Additionality 
• Over-crediting 
• Vintage (year of creation) 
• Leakage 
• Non-permanence 
• Avoided vs Removal 
• Stakeholder perception 
• Developer profile 
• Community impacts

How do EACs fit into an integrated Strategy? 

For any business, there are four typical ‘Carbon Reduction Levers’ available to decarbonise its operations. The availability of these levers differs from site to site, company to company. No one-size-fits-all.  

An integrated strategy will draw on all these levers. However, what is common for every single site is the ability to create, monetise, and purchase Environmental Attribute Certificates.  

At Northmore Gordon we believe that high-integrity environmental markets are critical for businesses to transition to clean energy. This will support businesses to adopt a nature-positive model, and strategically position them for enduring success.  

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Whether it be recognising status or declaring ownership, certificates acknowledge value. For the broad class of products known as Environmentally Attributed Certificates, the value comes from ascribing some environmental benefit to a traded commodity.

Environmentally Attributed Certificates most commonly apply energy or carbon attributes to a generation or offsetting activity, yet they can be used to track any type of environmental value, such as distinguishing between different carbon intensities of hydrogen or managing nitrate concentration in water outflows. In essence, Environmentally Attributed Certificates serve as an accounting layer that sits atop a product or commodity to track its environmental credentials.

Certificates and their markets serve as valuable economic tools to incentivise businesses to embrace decarbonisation and environmental responsibility. Understanding how the Environmentally Attributed Certificate markets function and operate will help businesses design a procurement strategy that aligns with the national decarbonisation goals as well as their own corporate objectives.

What are the Different Energy Certificates?

In the energy space, there is a spectrum of certificates to distinguish between various decarbonisation efforts and activities:

• Green Certificates (Energy Attributed Certificates)
• White Certificates
• Carbon Offsets or Carbon Credits

Green Certificate

A Green Certificate, also known as a Renewable Energy Certificate (REC), represents 1MWh of renewable energy generation. Popular energy sources for these certificates include PV solar, wind, hydro, geothermal, and biofuels. Nuclear is not typically credited because uranium is not a renewable fuel, despite having zero carbon intensity.

To take things a step further, there are Time-based Energy Attributed Certificates being trialled that match the renewable energy generation with the electricity demand on an hourly basis throughout the day.

White Certificate

White Certificates are used to track reductions in energy use and are measured in either MWhs of energy saved or in Tonnes of CO2-e abated. Certified activities are typically those that improve energy efficiency, such as replacing traditional lighting with LEDs, installing more energy-efficient equipment, or adjusting business practises to increase energy productivity. There is an emerging market for demand response certificates that aim to drive reductions in peak energy use times at the height of summer. 

Carbon Offsets (or Carbon Credits)

Carbon Offsets represent a reduction of one metric tonne of CO2-e from either removal or avoidance activities. Emissions removal involves activities that will extract carbon from the atmosphere. This includes planting new forests, making certain changes to agricultural practices, or implementing direct air capture and sequestration technologies. On the other hand, emissions avoidance activities stop emissions that would have otherwise occurred. Energy efficiency measures, fuel switches to low-carbon sources, and forest conservation practices are examples of emissions avoidance activities.

What are the Principles of an Environmental Certificate Program?

Certificates must pass through a regulatory framework to become approved and registered for trading. This involves registering a project, monitoring the activity or performance of the project, collecting data and evidence to support the environmental claims, undergoing external verification, and being accepted by the program regulator.

Once projects and their associated certificates are approved, the certificate programs have underlying principles that promote the existence and maintenance of certificate markets. These fundamental principles include additionality, persistence, and traceability.

Additionality asserts that having an existing certificate market promotes the development of activities that would otherwise not have developed under business-as-usual scenarios. For instance, without the existence of REC markets, there would not be an economic incentive for developers to build renewable energy plants. Therefore, the certificates stimulate additional activity to drive climate, energy, and other environmental improvements. As such, owners of environmental certificates can take ownership of driving this progress.

Persistence refers to the certified activity having a lasting impact. In some situations, this persistence may mark that savings are intact for an allotted period of time. For other certificate activities, it assures permanence, where the carbon offset or sequestration activity represents emissions reductions that are permanently maintained and not re-released into the atmosphere.

Traceability enables certificates to be traced back to their source and for them to be tracked in a registry. This promotes transparency of activity and also inhibits certificates from being used by multiple parties.

These programs can be administered by government regulators or by third-party administrators. Certificate programs give shape to market-based funding programs, voluntary markets, and direct obligation schemes.

What are the Types of Certificate Markets?

There are two types of markets for certificates: compliance and voluntary. While demand is generated differently between these distinct market types, they both share the same underlying objective of accelerating environmental goals through an additional source of funding. This funding makes it feasible to develop renewable energy plants, implement energy savings strategies, and build carbon-reduction projects.

In regulatory compliance markets, there is an obligation on liable entities to surrender a certain number of certificates each year. Government bodies are the typical regulator for this market type, placing requirements on certain entities – such as electricity providers or large energy users – to surrender back to the government a certain number of certificates each year. Often there is a penalty price in compliance markets if an obligated entity fails to surrender the required number of certificates. Regulatory markets are the primary market for most certificates, yet there are certificates that are gaining popularity within voluntary markets.

In contrast to the compliance market, voluntary markets generate demand through businesses and consumers who want to buy certificates for their environmental credentials. These credentials bring businesses closer to achieving goals focused on net-zero pathways, decarbonisation, resource conservation, community development, and environmental stewardship. Although participation in voluntary markets is optional, third-party recognition can stimulate demand for specific certificates within the market. For example, Climate Active, the Australian government’s carbon-neutral standard, only recognises certain certification types as eligible carbon offsets, which makes them more coveted than other certificates in the market.

There is a greater diversity of certificates within voluntary markets than in compliance markets. This causes voluntary markets to exhibit certificate price differential that is unseen in compliance markets where all certificates are treated as equal. Price disparity can be caused by the type of certificate, such as whether it represents carbon avoidance or carbon removal. In addition, some certificates in the voluntary market may cost a premium due to their associated co-benefits that align with the United Nations Sustainable Development Goals.

Not all certificate types have both compliance and voluntary markets – some certificate products are entirely voluntary, and some certificates with a compliance market have no voluntary demand from buyers. Where both a compliance market and a voluntary market exist for the same certificate, the prices are linked as demand in the voluntary market reduces the supply for the compliance market and vice versa.

How Does an Environmental Certificate Provide Value?

Holding an environmental certificate enables the owner to take claim to the environmental benefit it offers. For instance, when clean electricity from a PV solar farm enters the grid, it becomes indistinguishable from the rest of the grid electricity that is generated from other power sources. This makes it difficult to determine who the end-user of that clean electricity is. Therefore, a facility must purchase a REC to make the claim that they are indeed using the clean electricity generated from that solar farm. Without the certificate, the facility is unable to make the claim and is therefore unable to take advantage of the other significant business benefits that stem from transitioning to a clean energy profile.

Making the clean energy transition is becoming increasingly important, as people, governments, corporations, and investors want stability now and security for the future. Climate change is no longer an abstract scientific conversation. It is wrapped into all pressing matters of the day, from fuel price hikes and supply chain bottlenecks to rising concerns around sweeping fires, intense storms, and dying coral reefs. Our climate and environment must be prioritised, and businesses that adapt to and embrace a nature-positive model are positioning themselves for long-term success.

Although there are immeasurable societal and environmental benefits in transitioning away from fossil fuels and protecting the environment, there also must be sound economic motives to really incentivise businesses to embrace decarbonisation. This is where certificate markets, and Northmore Gordon, come into play.

Northmore Gordon specializes in the nuances, policies, and procedures of the energy certificate marketplace. We help businesses find and source energy solutions that promote the well-being of their own business as well as that of the community and environment. To incorporate a more nature-positive strategy and stay ahead of the changing energy landscape, reach out to us and see just how empowering our partnership can be.

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