| Summary: | In electricity markets evolving towards liberalisation and internationalisation, green certificates are seen as an important tool to promote production of renewable energy. In a green certificate market producers sell certificates received per unit of electricity generated from renewable energy. Trade in renewability is thereby decoupled from the the physical electricity trade. Tradable green certificates in combination with renewables obligation are implemented or planned in several EU member states. Integration at EU leveland the creation of a common certificate market seem like a possible next step. Using a simple model, the effects of an EU system for tradable green certificates, compared to national implementation, are tested for the period 2000–2010. The simulations show a clear increase of cost effectiveness and large changes in the geographical balance of renewable energy when reaching the EU 22 per cent target. Less competitive technologies, such as solar power, are not deployed at all. The situation is however similar without international trade. Rather than implementing a certificate market with all EU member states, but with different support schemes, a smaller market, only with countries that combine the certificate market with renewables obligation, is recommended.
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