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Developments in two of the European renewables certificates markets grabbed the headlines in the past quarter, though without significantly changing market prices. The Netherlands' government announced its new budget last month -- as good as killing off what remained of the Dutch green certificates. The energy tax rebate which currently stimulates the market will be halved again from July 2004, to EUR 15/MWh, and disappear completely in 2005. The tax rebate will be replaced by an increase in the feed-in tariff (MEP). Whether the voluntary certificates market, currently at some 1.4 million households, will survive this onslaught remains to be seen. Meanwhile, the UK Renewables Obligation Certificates (ROCs) market has been rocked by the likelihood of TXU Europe defaulting on its obligation, putting in danger the value of the recycling of the buy-out penalty and hitting the market value of ROCs (page 44). One of the results is that no bids are being shown in the market at flat prices per certificate.

The renewables certificates markets in the US, specifically in Connecticut, New Jersey, Massachusetts, and Texas, have continued trading steadily with moderate price movements. With the aggressive targets in Connecticut and Massachusetts, prices have remained close to their legislated caps, at around $40/MWh (EUR 36). Of more interest in the US is the voluntary green power market, where transactions were bundled with the underlying power and both public and private entities drove the demand. This market has surged in New York, with the environmental aspects priced at about $5/MWh (EUR 4.4). The New York Power Authority recently committed to the purchase of up to 50 MW of wind power from Windfarm Prattsburgh and Chautauqua “uåX˜äŠÊ˜·³Ç, about half the rated output of each project. The remaining power from each facility is being marketed to private sector companies. Windfarm Prattsburgh will be installing up to 67 turbines in upstate New York. In another government procurement, several US Defense Department facilities will be supplied with greened power by a New York electricity supplier.