Instead, 9.7 TWh worth of 2024 GOs will be on offer, with 77 % of this volume set at a EUR 0.10/MWh floor price, which is close to the over-the-counter (OTC) market price.

The temporary suspension of the Italian Energy Release scheme pending Commission’s probe has introduced uncertainty into the domestic GO market. Initially, 23 TWh of GO volumes were supposed to be removed from the GSE’s auctions in favour of the scheme’s 3,000 approved beneficiaries for the period 2025-2027.

The announcement of Friday’s auction supports this expectation. Usually, GSE tends to offer GOs from the current production year at its June auctions, suggesting that they are still holding them off while awaiting the Commission’s verdict.

This means that for now, no volumes previously set aside for the Energy Release scheme will be redirected to the open market.

Market impact

If the Commission clears the Energy Release scheme, GSE’s subsidised certificates volume could stop entering the market via auctions as they will be transferred directly to the scheme’s beneficiaries. Veyt, therefore, expects reorientation of the market as other players (e.g. corporates) could turn to traders to procure renewable electricity, especially in light of recent changes that liberalised GO trading in favour of the OTC market. Previously, GO cancellations had to be done on electricity suppliers’ accounts.

The overall supply and demand dynamic in the local GO market will not change in the short to mid-term, since the number of certificates that will exit the market on the supply side will also enter the market on the demand side.

However, the market could lose one of its biggest auctions, which functioned as a strong price signal to OTC market participants until now.