01 Mar 2022 / Market
In Germany, the greenhouse gas quota (GHG quota) has been all over the news since the beginning of the year, as EV owners are now able to actively benefit from it. Electricity suppliers have the opportunity to create an attractive offer that directly includes the GHG quota in the electricity contract. For end-customers, the new rule results in a reduction in their electricity costs without having to make any additional effort. In this blog we explain how easy it is to do this with Lumenazas energy as a service platform and what exactly the GHG quota entails.
What is the GHG quota and how does it work?
The GHG quota is a political instrument that has been in place in Germany since May 2021. It requires companies, such as oil companies, that sell greenhouse gas emitting fuels in Germany to offset a portion of their GHG emissions. The quota is currently set at 6 percent and will be increased to 25 percent by 2030.
If companies do not comply with the targets, they must pay a penalty per metric ton of greenhouse gases emitted. This penalty is currently euro 470 per metric ton of CO2 and will increase to euro 600. To meet the GHG quota, companies can either purchase lower-emission fuels, such as biodiesel, or purchase the GHG quota from third parties.
How emissions saved through e-mobility can be sold as a GHG quota
The GHG quota has been introduced to accelerate the transition to clean transportation and create incentives for switching to e-mobility. Since January 1, 2022, EV owners can sell the emissions saved by their EV as GHG offsets. For this, they are currently credited with a fixed value of 1943 kWh.
The quota trade is carried out by pooling service providers, who buy quotas from large numbers of EVs to sell them to oil companies in aggregated packages. These pooling service providers currently pass on a GHG revenue of around euro 300-400 per car per year to EV owners.
How electricity suppliers can easily integrate the GHG quota into their offer
Lumenazas energy as a service platform enables electricity suppliers to use the additional revenue from GHG quota trading to reduce the annual electricity costs for their end-customers. Lumenazas flexible billing software allows the electricity supplier to freely choose an existing pooling service provider to handle the GHG quota trading. Lumenaza takes care of the billing process and displays the GHG quota revenue as a bonus on the end-customers electricity bill.
This works via the integration of Lumenazas bonus API. Via the API, the data is sent directly to the respective pooling service provider and processed accordingly.
The electricity supplier can specify the GHG quota revenue for its customers with a description text and validity period such as ''GHG Bonus 2022''.
How end-customers can easily benefit from the GHG quota
The GHG quota enables end-customers to save up to euro 400 per year. When the GHG quota is directly integrated into their electricity contract, they benefit from a one-stop solution with no extra effort on their part. Instead of having to sign numerous contracts and receiving many different invoices from different parties, Lumenaza bundles the payment flows and end-customers receive a single electricity bill that directly includes the GHG quota revenue.
What it looks like in practice
If an EV owner has an annual consumption of 3500 kWh at an energy price of euro 0.40/kWh and a base price of euro 150 per year, her charging costs will be euro 1550 per year. Based on a GHG quota revenue of euro 300, her electricity bill will be reduced to euro 1250. She is directly rewarded for her low-carbon lifestyle, having part of her electricity costs paid for by oil companies. End-customers get to consciously experience the transition to clean transportation through a tangible personal benefit.
Would you like to pass on the benefits of the GHG quota to your customers? Get in touch with us.
