Italy’s first gas GOO auction sells above GME market

More than three-quarters of offered biomethane guarantees of origin (GOOs) were sold in Italy's first gas GOO auction on 20 March, with prices well above prices reported on Italian energy operator GME's bilateral platform.

The 490.7GWh of offered gas GOOs were from forth-quarter 2023 production and only for non-exportable biomethane for transport. Only 308.5GWh from November and December production sold and 67GWh of October production sold.

The auction achieved a weighted average price of €1.20/MWh, the reserve price was €0.92/MWh, with higher prices achieved for October volumes. The maximum price in the auction was €1.83/MWh. A total of 231.3GWh of non-exportable biomethane for transport GOOs traded at a weighted average price of €0.04/MWh on GME's bilateral platform in January-February, with the maximum price at €0.10/MWh.

Italian non-exportable biomethane for transport GOOs sold well below Danish and Dutch Renewable Energy Directive (RED II) certified gas GOOs, valued at €22/MWh on 14 March. The Italian market is still discovering how to use the new gas GOOs within the regulatory framework and how it can be used for EU emissions trading scheme reductions.

Biomethane GOOs have only been traded on GME's exchange platforms since January following a decree published in July by Italy's environment and energy security ministry. Decree 224 provides for the introduction of gas GOOs, which will be followed by hydrogen GOOs, as well as certificates for heating and cooling sources at a later stage.

Biomethane in the transport sector needs to be produced from feedstock listed in Annex IX Part A of the recast of RED II and includes food and municipal waste, manure or straw.

The next auction for GOOs by energy agency GSE will be on 20 June.

By Emma Tribe