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    2009 Annual Report CertiQ B.V.

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    1 Foreword 3 Being alert 4 2 Developments 6 2.1 Certificate production in 2009 6 2.2 New European Directive on Renewable Energy 7 2.3 The AIB’s supporting role 8 2.4 Customer satisfaction survey 9 2.5 Improving automation systems 10 2.6 Grey Power Certificates comply with high standards 11 2.7 CertiQ and the NL Agency: a well-matched pair 11 Critical 14 3 CertiQ 16 3.1 The certificate system 16 3.2 Overview of tariffs 19 3.3 Organizational structure 20 3.4 Code of Corporate Governance 21 Precise 22 4 Results for 2009 24 4.1 Key figures 24 4.2 Imports and exports of Guarantees of Origin 26 4.3 CHP certificates 29 4.4 Financial results 29 Clear 32 5 Financial position in 2009 33 Appendix: CertiQ works together with … 47 Printing details Adress and publication details

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    Printing details This annual report is printed on ‘Oxford’ paper. Oxford has a FSC Mixed Sources label, i.e. it is made of at least 50 percent wood pulp from an FSC certificated source; the other pulp consists of recycled material and/or wood from sources monitored by the FSC. The FSC quality mark is a guarantee that the raw material for the paper originated from forests managed in an environmentally responsible way and not from forests with high environmental value, such as primary forests, or from a plantation created by replacing a tropical rain forest.

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    CertiQ BV 2009 Annual Report

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    Foreword Change is a striking constant in CertiQ’s field of operations. This was true again in 2009. Our partnership with the NL Agency (formerly known as SenterNovem) expanded further, there was a big influx of solar energy producers and the European Commission introduced a new Renewable Energy Directive. At CertiQ we realize that these developments require us to adopt a particular attitude to our work, an attitude that we would describe as alert. In other words: focused, critical and pro-active. In retrospect, we see that in recent years this attitude has become increasingly important as a common thread running through our operations. So we have made being alert the theme of our 2009 annual report. Naturally, we were alert to the significance of the European Directive. This confirms the strong Dutch green power model, but also leaves some crucial aspects open to interpretation by Member States. We also think it’s important to remain alert in the way we provide services. To get a good picture of where we stand today, we commissioned an independent customer satisfaction survey. In 2009 we were also alert to the quality of our automation system, which must continue to be stable and flexible in the future. In addition, and we’ve been alert to cost issues. We have persuaded the Ministry of Economic Affairs that certain costs the certificate system incurs in relation to the SDE subsidy scheme should no longer be borne by the participants. By remaining alert to such issues, we are able to keep the tariffs for our participants as low as possible. We should also mention here the most important developments in the generation of renewable electricity itself. The volume of certified megawatt hours of renewable electricity generated in the Netherlands grew by 13.2 percent in 2009 as compared to 2008. At the same time, energy consumption in the Netherlands began to decline in 2009. As a result, renewable electricity accounted for an increasing proportion of total energy. The following chapters explain the various developments in more detail. We trust that this will alert you to the most important development in our field of operations in 2009. Gineke van Dijk Ben Voorhorst Manager of CertiQ BV Chief Operating Officer of TenneT TSO BV 3 CertiQ 2009 Annual Report

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    Developments 2.1 Certificate production in 2009 In 2009 we saw growth across the board: in the number of generating plants, in installed capacity and in the production of renewable electricity. The number of registered generating plants grew from 1,977 to 4,837, an increase of 144.7 percent. This figure needs to be put in perspective. The increase was primarily due to the many small solar power plants that have been registered with CertiQ. Most of these belong to individuals who have solar panels on the roofs of their homes. This progress towards sustainability, while meaningful in itself, does not have a significant effect on the total picture. The total installed capacity of solar panels reached 18.4 megawatts, which represents about 0.1 percent of total renewable electricity generation. However, this increase in the production from solar generating plants will continue in 2010, since the NL Agency has approved many grants in 2008 and 2009 for solar plants, which will lead to the installation of more solar panels and more sustainable production in the years ahead. Last year, fifteen new biomass plants were added, many of them small manure digesters. The number of wind plants declined by thirteen,1) but this is not a negative development as older turbines were replaced by a smaller number of large turbines with greater generating capacity. In figures: at the end of 2008 there were 1,054 wind plants with an installed capacity of 2,197 megawatts; at the end of 2009 there were 1,041 wind plants with a capacity of 2,247 megawatts. The number of certified megawatt hours of renewable electricity generated in the Netherlands grew by 13.2 percent in 2009, as compared to 2008. Total production was 10,188,939 MWh. The sources making the largest contributions were, as usual, biomass (55.1 percent) and wind (43.8 percent). Certified solar and water power together accounted for 1.1 percent of the total volume. As in previous years, consumption of renewable electricity increased in 2009. We measured an increase of 17.8 percent compared to 2008. The number of certificate cancellations, which are proof of delivery to consumers, increased from 21,529,538 MWh in 2008 to 25,371,724 MWh in 2009. 6 CertiQ 2009 Annual Report

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    It is striking that the production of renewable electricity grew in 2009 at the same time as energy consumption in the Netherlands decreased. The result was that the share of renewable electricity in total energy consumption increased, from 7.54 percent in 2008 to 8.92 percent in 2009.2) To meet the growing domestic demand for renewable electricity, guarantees of origin for 16,937,736 megawatt hours were imported last year. This is 10.5 percent less than in 2008. The reason the Netherlands still has to import renewable power is that the construction of new plants here takes time, while in the meantime demand for green power continues to grow. 2.2 New European Directive on Renewable Energy In June 2009, the new European Directive on Renewable Energy came into effect.3) In this Directive, the European Commission prescribes a comprehensive package of climate regulations for Member States. It includes a number of detailed rules for the certification of renewable electricity, but these are largely consistent with CertiQ’s current practices. We quote here the main requirements that a guarantee of origin must meet under Article 15 of the Directive. The certificate must indicate: - The energy source used in production, and the start and end dates for the production - The identity, location, type and capacity of the plant in which the energy was generated - The date on which the plant became operational - The date and the country issuing the certificate, and a unique identification number. A Guarantee of Origin must be used within twelve months of the production of the corresponding energy. The Directive also stipulates that the certification must be implemented through an electronic system that is reliable and fraud-resistant. And the Directive is clear on the function of the certificates: they are intended to provide transparency to consumers. 1) A wind plant registered with CertiQ may comprise one or more wind turbines. 2) The 2009 figure is based on an initial estimate because the final figures for total energy consumption in the Netherlands were not yet known when this report was compiled. 3) Directive 2009/28/EC of the European Parliament and of the Council on the promotion of the use of energy from renewable sources. 7 CertiQ 2009 Annual Report

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    CertiQ is very pleased with the clarity that the Directive provides for Guarantees of Origin. In our view, it makes many aspects of the certification of renewable electricity more efficient and credible. There is, for example, a requirement that a Guarantee of Origin must be cancelled when used. Including this in the Directive will ensure greater consistency across Europe and such harmonization will certainly have a positive impact on the international trade in certificates. However, we find it regrettable that the European Commission has left some crucial issues relating to certification open to further interpretation by the Member States, rather than specifying them. This could result in differences in the way in which Member States apply Guarantees of Origin. CertiQ naturally hopes that the existing successful Dutch model for green power will be retained. So we will work with the Dutch government on planning how the European Directive should be put into effect in national legislation in 2010. 2.3 The AIB’S supporting role The Association of Issuing Bodies (AIB), an international partnership of the organisations that manage Guarantees of Origin, secured a significant achievement last year. The European Commission’s New Renewable Energy Directive included virtually all the elements of the EECS standard for renewable energy certification, previously developed by the AIB. In effect, this standard was enshrined as ‘best practice’ in European law. To fully comply with the requirements of the Directive, the AIB has modified some details of the EECS standard. Some internal rules have been changed and simplified. The fully updated EECS standard provides bodies such as CertiQ, which manage guarantees of origin, with a perfect opportunity to inform their own governments about the most desirable implementation of the European Directive in national legislation. CertiQ, represented in the AIB by its manager Gineke van Dijk, has actively contributed to these achievements. Since April 2009, Gineke van Dijk has chaired the Executive Board of the AIB. Other CertiQ employees participated in AIB working groups in the past year, in the areas of policy and automation. 8 CertiQ 2009 Annual Report

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    2.4 Customer satisfaction survey CertiQ is a service organization. Our task is to offer the participants in the certificate system a user-friendly and well-functioning system. The greater our service orientation, the more we contribute to an important goal in Dutch society: the sustainability of our energy supplies. We are well aware of this, so we are committed to providing our customers with accurate information. If any questions or problems arise, we aim to offer a quick solution. But are we really so alert in everyday practice? We wanted our customers to answer that question themselves. In autumn 2009, we commissioned a customer satisfaction survey. The independent agency Effectory elicited the views of producers, grid operators and traders through a questionnaire that could be returned anonymously. Of the 717 subjects approached, 337 completed the questionnaire. Compared to the national bench-mark, that is a very high response. In addition, six interviews were conducted with representatives of the Ministry of Economic Affairs, the Office of Energy Regulation and the NL Agency. These government and quasi- government bodies gave our service an 8.5 rating (on a scale of ten). They were particularly pleased with the rapid and effective communication they had with CertiQ. Our work appears to meet their expectations. The producers, traders and operators rated some CertiQ staff very highly: the technology specialist scored 8.8 and the customer account manager an 8.1. However, the overall satisfaction rating was 6.7. The network operators had the most positive opinions of CertiQ and the producers the least positive. The responses showed that many solar energy producers, usually private individuals, found the application procedure unnecessarily complicated and cumbersome. The simplified application form that CertiQ has already developed for this group of producers has apparently not sufficiently allayed these concerns. Therefore we have decided to also streamline the general information provided on our site for solar energy producers in 2010, to facilitate the application process. In 2010 CertiQ will be taking further action to follow up on the focus points identified in the study. We will provide further information on this in the course of the year. 9 CertiQ 2009 Annual Report

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    If you are interested in the results of the customer satisfaction survey, you can request a summary of the report from CertiQ. To verify whether this study has really sharpened our focus, we will conduct a follow-up survey before too long. 2.5 Improving automation systems Our automated system for creating and cancelling certificates has been in use since 2001. Because of numerous regulatory changes and the increasing number of new data items, the system has been modified many times over the years. This cannot be continued indefinitely without incurring the risk that the application may become unstable. Moreover, all those work-arounds become disproportionately expensive. In the belief that our system must be stable and easily extensible well into the future, and to ensure that costs remain manageable, we scrutinized the whole system in 2009. We conducted a comprehensive analysis of our operations so that, in 2010, we would have a basis for deciding on creating a new system. If we decide to do so, it is important for cost reasons to include all major new developments at one time. For example, there is the new legislation that the Dutch government could introduce in 2010, based on the new European Directive on Renewable Energy. Also, a new system could be designed to be suitable for certification markets other than green power alone. 2.6 Grey Power Certificates comply with high standards Energy suppliers are obliged to inform their customers about the mix of sources in the electricity they supply. For the sustainable part of the mix, they rely on CertiQ’s accurate certification. For gas, coal and the like, they calculate the proportions based on their purchasing data or using national averages. That is less transparent than using Guarantees of Origin. CertiQ thinks that source labelling for electricity would be more transparent if all power, both green and gray, was certified. 10 CertiQ 2009 Annual Report

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    CertiQ has been advocating universal certification for years. To demonstrate that it works, last year we ran a pilot scheme with one major energy supplier, to certify electricity generated from natural gas. Moreover, in mid-2009 we were able to bring gray power certificates into compliance with the AIB’s EECS standard. We hope that this international recognition will encourage players on the Dutch market to make the move to full electricity certification. 2.7 CertiQ and the NL Agency: a well-matched pair Since the introduction of the Sustainable Energy Production Incentives (SDE scheme) in 2008, we have worked closely with the NL Agency, which implements the scheme. The cooperation intensified when the NL Agency took over the management of the older MEP subsidy scheme from EnerQ, at the beginning of 2009. EnerQ’s good work in transferring its responsibility meant that everything was soon running smoothly at the NL Agency, which also made our work easier. The cooperation between the NL Agency and CertiQ in 2009 was excellent. Active knowledge sharing and effective coordination has developed between the two organizations. We also took joint action, for example to assist producers and to present some issues requiring improvements to the Ministry of Economic Affairs. One example of the latter related to the registration fee and annual dues for producers of solar energy. The NL Agency and CertiQ pointed out to the Ministry that these charges are relatively high for individuals with a small solar installation on the roof of their house. The Minister therefore decided that, for this category of producers, the Ministry would bear these costs. This applies to all small solar installations granted an SDE subsidy decision in 2009 and 2010, and also applies retrospectively to 2008. That is good news for these producers. We also concluded a covenant with the NL Agency in 2009, which provides for CertiQ’s project costs relating specifically to the SDE scheme to be met by the NL Agency. This is an important agreement, because it separates the costs of facilitating certificate trading from the costs of facilitating SDE grants. 11 CertiQ 2009 Annual Report

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    CertiQ 3.1 The certificate system History In 2001, the Dutch government decided to structure the trade in, and supply of, electricity generated in an environmentally friendly way using a certification system. The certification system ensures that the whole chain of supply for green electricity is verifiable, from the producer to the final user. The certificates ensure that the green electricity used in the Netherlands has in fact been generated under the agreed conditions. CertiQ BV, a subsidiary of TenneT TSO BV, manages the system for issuing Guarantees of Origin. CertiQ is also charged with implementing the Renewable Energy Certificate System (RECS) in the Netherlands. This European certification system was initiated by various market actors and is not specifically anchored in national legislation. In 2003 the MEP subsidy scheme, which was intended to improve the environmental quality of electricity production, came into effect. Because of this there was, for the first time, a linkage between certification and subsidies for electricity generated in environmentally friendly ways, from renewable sources and in combined heat and power plants. In 2008 the MEP scheme was replaced by the Sustainable Energy Production Incentives (SDE) scheme. This scheme is broader, as it includes subsidies for the production of another form of renewable energy: green gas. Until 2005 it was possible to have certificates issued in the Netherlands for sustainable electricity produced in other countries. This system was replaced by one in which the certificates for production in other countries are imported. To ensure that this works optimally, CertiQ joined the Association of Issuing Bodies (AIB), an international partnership of the organisations that manage Guarantees of Origin. 14 CertiQ 2009 Annual Report

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    The certificates and their purpose CertiQ issues electronic certificates on the basis of the number of megawatt hours of electricity that a plant has produced. A certificate reports the volume and origin of the electricity produced and the date on which the certificates were issued. CertiQ can issue various types of certificate: Guarantees of Origin (for sustainable electricity and for high efficiency CHP plants) and CHP certificates as well as energy labelling certificates and Renewable Energy Certificate System (RECS) certificates. Guarantees of Origin are issued for electricity generated from the renewable sources wind, biomass, and hydroelectric and solar power. These Guarantees of Origin are proof that the amount of renewable electricity consumed has actually been generated in a sustainable manner. This is administered through the creation and cancelling certificates. The ultimate goal is transparency for the consumer. Guarantees of Origin for renewable electricity are also the basis for subsidy funding. Based on these certificates, producers can obtain grants from the NL Agency under the SDE scheme. Since 2008, Guarantees of Origin can also be issued for high-efficiency combined heat and power plants (HE-CHP), also known as high-yield co-generation. These certificates do not support any right to a subsidy; they are intended only as proof of delivery of high-efficiency CHP electricity. The ordinary CHP certificates, however, which also cover electricity from CHP plants, can be used for funding purposes. Until 2008, CHP electricity production was subsidised under the MEP scheme. From 2010 it will be possible to receive subsidies under the SDE scheme. Guarantees of Origin for renewable electricity serve a third purpose, in addition to creating transparency and the possibility of subsidies: they facilitate international trade in certificated electricity. The certificates allow a country to buy renewable electricity from another country. RECS, which stands for Renewable Energy Certificate System, was initiated by various international parties. Certificates issued under RECS are also intended for the purposes of international trade in renewable electricity, but are based on a voluntary system. These certificates may not be used in the Netherlands as proof of the supply of green electricity. Only Guarantees of Origin may be used for that purpose. 15 CertiQ 2009 Annual Report

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    Finally, energy labelling certificates are designed for energy suppliers. On the basis of these certificates they give their customers precise information about the part of the electricity they supply that is not covered by Guarantees of Origin for renewable electricity. The new European Directive on Renewable Energy, issued by the European Commission in 2009, means that guarantees of origin will continue to play a role in the international trading and labelling of electricity and renewable electricity. Procedures A producer fills out an application form, which is obtainable from CertiQ’s website, signs it and sends it to the grid operator. The operator assesses whether the plant meets all legal requirements. If he finds that it does, the operator also signs the producer’s application and sends it to CertiQ. We then register the producer, after which the issuing of Guarantees of Origin certificates will start. The number of certificates to be issued is determined on the basis of production data from the plant, which the grid operator sends to CertiQ every month. In the case of biomass, additional information about the composition and sustainability level of the biomass is required before certificates can be issued. The smallest production volume for which a Guarantee of Origin certificate is issued is one megawatt-hour (MWh). The solar panels mounted on the roofs of private homes may take about twelve months to earn a certificate for one MWh, whereas a wind turbine generates one megawatt of renewable electricity in less than an hour. Within the certification system, the certificates are produced digitally in a controlled way. More precisely: they are credited to the account of a trader nominated by the producer. Only traders registered with CertiQ can own Guarantees of Origin. Any natural or legal person can register with CertiQ as a trader. The trader can trade the certificates or use them as proof of the delivery of sustainable electricity to final consumers. For every megawatt hour of green electricity supplied to end consumers, a certificate of equal value must be debited, or ‘cancelled’. Traders do this themselves by logging in to CertiQ’s certification system and entering the number of certificates in their accounts that have been used and should be deducted. The Office of Energy Regulation monitors this process, i.e. it checks whether the quantity of certificates cancelled corresponds to the amount of electricity sold as sustainable electricity. 16 CertiQ 2009 Annual Report

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    Guarantees of Origin are not tradable if the sustainable electricity to which they relate was not fed into the public grid but supplied directly to a facility such as a factory. This power is already consumed by the immediate user. However, to the producer these guarantees of origin still represent proof of sustainable production. These certificates can only be used to obtain subsidies if they relate to solar power. Guarantees of Origin are valid for one year after they are issued. After one year, the certificate cannot be used as proof of delivery of sustainable electricity anymore. For more detailed information about certification, see www.certiq.nl. You will find a handy schematic overview of the procedures in CertiQ’s brochure, which can be requested free of charge. 3.2 Overview of tariffs CertiQ sets its tariffs periodically, after consultation with the Participants’ Council in which the participants in the certification system are represented, on the basis of a forecast of its operations. These tariffs are based on the income and costs of our organisation, which works on a cost-recovery basis. Profit or loss in one year is adjusted in following years by raising or lowering the tariffs (see Table 1). 17 CertiQ 2009 Annual Report

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    Table 1 Overview of tariffs, 2006 - 2010 Component January January January January January 2006 2007 2008 2009 2010 Registration producer 25 25 25 25 25 Registration trader 750 750 750 750 750 Registration aggregator 750 750 750 750 750 Annual fee producer 25 25 25 25 25 Annual fee trader 2,500 2,500 2,500 2,500 2,500 Annual fee producer 750 750 750 750 750 (<50,000 MWh) Annual fee aggregator 2,500 2,500 2,500 2,500 2,500 Annual fee aggregator 750 750 750 750 750 (<50,000 MWh) Per certificate of 1 MWh - issuing 0.060 0.062 0.069 0.060 0.045 - transfer 0.010 0.012 0.013 0.010 0.008 - use (cancel) 0.060 0.062 0.069 0.060 0.045 - import 0.010 0.012 0.013 0.010 0.008 - export 0.010 0.012 0.013 0.010 0.008 3.3 Organizational structure The team at CertiQ consisted of fourteen staff in 2009, working in the following positions: a manager, a customer accounts manager, a policy advisor, a coordinator for account management, four in-house account managers and one location specialist, two computer application managers, one financial controller, one assistant controller and a secretary. The average staff level was 12.5 full-time equivalents. By way of comparison, in 2008 it was 11.5 full-time equivalents. All of CertiQ’s staff are formally employed by our parent company, TenneT TSO BV. 18 CertiQ 2009 Annual Report

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    3.4 Code of Corporate Governance CertiQ, like TenneT (CertiQ’s sole shareholder and manager) has chosen, where possible, to comply with the Code of Corporate Governance. Management The management of CertiQ is responsible for strategic and organisational policy and for issuing and recording guarantees of origin and CHP certificates. CertiQ accounts for these activities to TenneT. TenneT establishes the framework for policy making for the internal risk management and risk control systems. Within this framework, the directorate and management of CertiQ are responsible for managing these systems. CertiQ draws up an annual financial plan, including the operating budget, investment budget and funding requirements. This annual plan is approved by the shareholder and constitutes the mandate for the management. CertiQ reports at least once each quarter to the shareholder about the implementation of the annual plan. It reports periodically regarding its financial results and operational developments. Financial reporting The management considers that the annual accounts for 2009 contain no inaccuracies of material importance. The Management is of the opinion, to the best of its knowledge and belief, that there are no further indications that CertiQ’s internal risk management and control systems with regard to financial reporting risks have not worked properly in the reporting year, and would therefore be unable to provide a reasonable degree of certainty that the financial reporting does not contain inaccuracies of material importance. External accountant CertiQ’s external accountant, PricewaterhouseCoopers Accountants NV, is charged with verifying our annual accounts. It reports to both the Supervisory Board and the Management. The external accountant draws up the Audit Report and the Management Letter and provides an auditor’s opinion to accompany the annual accounts. 19 CertiQ 2009 Annual Report

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    Results for 2009 4.1 Key figures At the end of 2008, CertiQ had a total of 4,837 generating plants for renewable electricity on its register. This is 144.7 percent more than in 2008. This rate of growth is almost entirely attributable to registrations for solar energy producers. Table 2 shows the breakdown for the four sources of renewable energy: biomass, wind, solar and water power. Table 2 Number of generating plants as of 31 December 2008 Generating plants based on 31 December 2009 31 December 2008 Biomass 205 190 Wind 1,041 1,054 Solar 3,574 718 Hydro-electric 17 15 Total 4,837 1,977 In 2009 CertiQ certified a total of 10,188,939 megawatt hours of renewable electricity produced in the Netherlands. This is a 13.2 percent increase as compared to 2008. Chart 1 shows the changes, broken down for biomass, wind, solar and water power. Figure 1 The certified production of sustainable electricity in the Netherlands x 1,000 MWh 700 600 500 400 300 Solar 200 Hydro-electric 100 Wind 0 Biomass 2007 2008 2009 22 CertiQ 2009 Annual Report

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    Wind energy contributed 4,461,229 megawatt hours of certified production. This is 3.3 percent more than in 2008. Replacement investments led to the introduction of turbines with greater production capacity. A total of 50 megawatts of capacity was added. At the end of 2009, the wind generating capacity on land and sea in the Netherlands, registered with CertiQ, was 2,247 megawatts. Another 5,620,158 megawatt hours of electricity generated from biomass was certified, a rise of 22.7 percent compared to 2008. This growth was mainly due to mixing biomass in the fuel used in standard power stations. The substantial increase in the number of small solar power plants in 2009 had not yet led to more solar power being certified. The meters at very small plants are only read once a year and those for many new solar plants will be read for the first time in 2010. Solar and water power together contributed 107,552 MWh of certified power, which is 1.1 percent of the total production of renewable electricity in the Netherlands. The total consumption of renewable electricity in the Netherlands (i.e. the number of cancellations recorded at CertiQ) increased from 21,529,538 MWh in 2008 to 25,371,724 MWh in 2009. Imports of renewable electricity declined by 10.5 percent last year, to a total of 16,937,736 MWh. Figure 2 Certificates issued for Dutch sustainable electricity x 1,000 MWh 1,200 1,100 1,000 900 800 700 600 500 400 300 Solar 200 Hydro-electric 100 Wind 0 Biomass 2007 2008 2009 23 CertiQ 2009 Annual Report

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    Figure 1 and 2 show different patterns. This is because Figure 1 showed renewable electricity production, while Figure 2 shows the certificates CertiQ has issued. It is important to note that the volume of certificates issued in a certain month can reflect both newly generated electricity and electricity generated further in the past. 4.2 Imports and exports of guarantees of origin Table 3 Overview of imports and exports Import / Export in MWh 2009 2008 Imports 16,937,736 18,923,973 Exports 309,476 1,475,914 Figure 3 Imports of sustainable electricity x 1,000 MWh 4,000 3,750 3,500 3,250 3,000 2,750 2,500 2,250 2,000 1,750 1,500 1,250 1,000 750 500 Hydro-electric 250 Wind 0 Biomass 2007 2008 2009 24 CertiQ 2009 Annual Report

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    Figure 3 shows that the certificates imported in 2009 related mainly to hydro-electricity. Figure 4 Imports of Guarantees of Origin, by country of origin x 1,000 MWh 2,500 2,250 2,000 1,750 1,500 1,250 1,000 750 Denmark Finland 500 The Netherlands 250 Norway 0 Sweden 2009 Guarantees of Origin can be traded within Europe. Figure 4 indicates the country that originally issued the certificates imported to the Netherlands in 2009. Figure 5 Activity relating to sustainable electricity in the system x 1,000 MWh 4,500 4,000 3,500 3,000 2,500 2,000 1,500 Supply (cancellations, & own consumption) Export 1,000 Import 500 Expired 0 Issued 2007 2008 2009 25 CertiQ 2009 Annual Report

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    Figure 6 Certificate transfers x 1,000 MWh 1,400 1,200 1,000 800 600 400 200 0 2007 2008 2009 Table 4 RECS participants RECS 31 December 2009 31 December 2008 Number of generating plants 245 246 Number of traders 28 22 Number of aggregators 0 0 Table 5 Guarantee of Origin participants Guarantees of Origin 31 december 2009 31 december 2008 Number of generating plants 4,837 1,977 Number of traders 55 58 Number of aggregators 2 3 26 CertiQ 2009 Annual Report

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    4.3 CHP certificates The old subsidy scheme for CHP generation was terminated in 2008. Soon after that, we removed the CHP installations from the CertiQ register. In 2009, the only CHP power that CertiQ certified was produced in 2007 and earlier: this was certified in the course of finalising some files. From 2010, newly built CHP plants will again be subsidized, this time under the SDE scheme. Therefore in the future CertiQ will again issue CHP certificates for producers who seek subsidies for these plants. Table 6 Certificates issued for CHP electricity (in MWh) CHP certificates issued 2009 2008 308,197 1,536,657 4.4 Financial results The costs and revenues for 2009 (in euros) can be summarised as follows: 2009 2008 Invoiced revenue 3,045,728 3,019,706 To adjust in tariffs - 967,229 - 591,365 Revenue as per the annual accounts 2,078,499 2,428,341 Operating costs 2,081,086 2,401,802 Trading results - 2,587 26,539 Financial costs and income 2,587 - 26,539 Result - - 27 CertiQ 2009 Annual Report

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    In 2009, CertiQ’s invoiced revenue increased very slightly compared to 2008. The increase was partly due to increasing registrations and membership fees. Revenues from certificate issues and transfers fell compared to 2008. This decrease is due to a decline in the production of CHP certificates (because of the ending of the old CHP subsidy scheme) and to a decrease in the import and export of certificates. The decrease in operating expenses compared to 2008 is mainly due to savings CertiQ achieved in the areas of automation and personnel costs. Lower depreciation also contributed to the decrease in operating expenses. Because CertiQ clears any differences between revenues and costs by adjusting its future tariffs, CertiQ’s result is always zero. The cumulative amount up to 2009 that will be cleared by adjusting tariffs is € 1,648,156. This means that there is still an excess income of € 1,648,156 to be adjusted in the tariffs for 2010 and beyond. Therefore at the end of 2009 it was decided to reduce tariffs for 2010 by 20 to 25 percent. 28 CertiQ 2009 Annual Report

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    Financial position in 2009 Balance at 31 December 2009 after appropriation of profits 34 Profit and loss account for 2009 35 Cash flow statement for 2009 35 General notes 36 Notes to the balance sheet at 31 December 2009 after appropriation of profits 38 Notes to the profit and loss account for 2009 41 Other information 44 33 CertiQ 2009 Annual Report

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    Balance at 31 December 2009 after appropriation of profits (euros) Assets Ref. 31 December 2009 31 December 2008 Non current assets 1 Tangible fixed assets 393,693 674,991 393,693 674,991 Current assets Receivables 2 Accounts receivables 390,882 482,351 Group companies 1,291,693 - VAT 392 - Prepayments and accrued income 21,680 3,715 1,704,647 486,066 Cash equivalents - - 2,098,340 1,161,057 Liabilities Ref. 31 December 2009 31 December 2008 Equity 3 Share capital 18,000 18,000 18,000 18,000 Current liabilities 4 Accounts payable 26,417 29,203 Group companies - 71,697 Other liabilities 405,767 361,230 Amounts received in advance 1,648,156 680,927 2,080,340 1,143,057 2,098,340 1,161,057 34 CertiQ 2009 Annual Report

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    Profit and loss account for 2009 (EUR) Ref. 2009 2008 Revenue 5 2,078,499 2,428,341 Operating expenses 6 Systems for process automation 357,774 429,023 Personnel expenses 736,109 753,076 Depreciation on tangible fixed assets 388,633 700,480 Other operating expenses 598,570 519,223 2,081,086 2,401,802 Operating result -2,587 26,539 Financial costs and income Interest income 2,587 - Interest expenses - 26,539 2,587 - 26,539 Profit before tax - - Tax - - Profit after tax - - Cash flow statement for 2009 (EUR) 2009 2008 Cash flow from operational activities To adjust in tariffs 967,229 591,364 Depreciation on tangible fixed assets 388,633 700,480 Working capital: - Changes in receivables 73,112 72,208 - Changes in current liabilities 41,751 249,268 1,470,725 1,613,320 Cash flow from investments Investments in tangible fixed assets - 107,335 - 284,935 Change in the current account 1,363,390 1,328,385 35 CertiQ 2009 Annual Report

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    General notes Nature of the business operations TenneT TSO BV (henceforth: TenneT), the Transmission System Operator and administrator of the national high-voltage grid, has been designated by the Minister of Economic Affairs, in a Ministerial decision, to establish an E-certificate system. TenneT established CertiQ BV to set up this system and perform the activities associated with it. CertiQ’s goal is to facilitate trading in sustainable electricity by issuing and managing production certificates. Production certificates, also known as Guarantees of Origin, are created when sustainably generated electricity and electricity from high-efficiency combined heat and power plants (CHP) is produced. The certificates for sustainable electricity are eligible for subsidies under two legally established schemes: the Environmental Quality of Electricity Generation Act (MEP) and the Sustainable Energy Production Incentives (SDE) scheme. They are also nationally and internationally tradable. In the past, CertiQ was also responsible for issuing certificates for CHP production, for subsidy purposes. This scheme was terminated as of 1 January 2008, and activities were phased out in the course of 2008. CertiQ is also responsible for issuing RECS certificates, under the Renewable Energy Certificate System. These are certificates to facilitate the international trade in renewable energy in countries where Guarantees of Origin have not yet been introduced. All the shares in CertiQ are held by TenneT. Principles used for valuations of assets and liabilities General The annual accounts are drawn up in accordance with generally accepted reporting procedures in the Netherlands. Unless otherwise stipulated, all amounts are recorded at nominal value. 36 CertiQ 2009 Annual Report

  • Page 40

    Non current assets The tangible fixed assets are valued at the original purchase price or production cost, after deducting linear depreciation. An allowance is made for any long-term loss of value that is expected on the balance date. Depreciation of the purchase price or cost of production is spread over time, on the basis of the expected economic life. Current assets Receivables are valued at nominal value, less a provision for bad debts. Principles for determining profit and loss Revenue Under Article 6, paragraph 5 of the Ministerial decision on Guarantees of Origin for renewable electricity, the independent manager of the power transmission grid may charge the cost of managing production certificates to the producer, customer, supplier or trader. There are exceptions for some categories, for which the Minister of Economic Affairs bears the costs (Article 6, paragraph 6 of the Ministerial decision on Guarantees of Origin. The Board of TenneT fixes the tariffs each year, after hearing advice from the Participants’ Council. Any difference between actual costs and billed revenues is adjusted in future tariffs. Operating expenses Costs are determined on a historical basis and allocated to the year to which they relate. Depreciation on tangible fixed assets The depreciation on tangible fixed assets is based on the acquisition cost and expected economic life. 37 CertiQ 2009 Annual Report

  • Page 41

    Taxes The tax due on the result is calculated by applying the currently applicable taxation rate to pre-tax profits, taking permanent differences between the fiscal and commercial calculation of profits into account. Notes to the summary of cash flows The summary of cash flows has been drawn up using the indirect method. Liquid assets are automatically transferred to TenneT’s current account, through a daily cash pool. Therefore, the current account appears as the final item in the cash flow statement. Notes to the balance sheet at 31 December 2009 after appropriation of profits (in euros) 1 Non current assets Tangible assets Software is included in tangible fixed assets, and is depreciated over three years. Since the beginning of 2006, the software developed by TenneT on behalf of CertiQ has been capitalised on the balance sheet and recorded as equity. 38 CertiQ 2009 Annual Report

  • Page 42

    The book value of the tangible fixed assets can be specified as follows: Software 2009 2008 Tangible TFA under fixed assets construction Total Total As of 1 January Purchase value 1,836,052 119,486 1,955,538 1,670,603 Cumulative depreciations and write-offs 1,280,547 - 1,280,547 580,067 Book value as of 1 January 555,505 119,486 674,991 1,090,536 Capitalisation - 107,335 107,335 119,486 Entering operational service 226,821 - 226,821 - 165,449 Disinvestments at book value - - - - Depreciation 388,633 - 388,633 700,480 Changes - 161,812 -119,486 - 281,298 - 415,545 As of 31 December Purchase value 2,062,873 - 2,062,873 1,836,052 Capitalisation - - - 119,486 Cumulative depreciations and write-offs 1,669,180 - 1,669,180 1,280,547 Book value as of 31 December 393,693 - 393,693 674,991 2 Receivables Group companies This item concerns the current account with TenneT. The year ended with a positive balance of €1,291,693. The balance on the current account at TenneT attracts interest. Prepayments and accrued income This relates to activities in 2009 for which invoices have not yet been written. 39 CertiQ 2009 Annual Report

  • Page 43

    3 Equity Share capital The authorised capital of the company is € 90,000, divided into 900 shares of € 100 each. Of these, 180 shares have been issued and paid up. 4 Current liabilities Other liabilities This relates to accumulated paid holidays and outstanding charges, consisting of a reserve for audit fees and the cost of the annual report. This item also includes a contribution received in advance from the NL Agency for the MEP-SDE and Biomass projects, as well as prepaid recharge costs for the MEP and waste incineration plants projects. Amount received in advance This relates to the difference between invoiced revenue and CertiQ’s operating costs. This amount will be adjusted with the market actors in future tariffs. The balance ‘To adjust in tariffs’ has changed as follows: 2009 2008 Balance as at 1 January - 680,927 - 89,562 Change - 967,229 - 591,365 Balance as at 31 December - 1,648,156 - 680,927 Rights and obligations not evident on the balance sheet CertiQ, with TenneT and its subsidiaries, is part of one fiscal entity for company tax and sales tax purposes. On the basis of the standard conditions as laid out by the taxation authorities at the time the fiscal entity was established, CertiQ is primarily liable for the company tax and sales tax liabilities of the whole fiscal entity. CertiQ has signed a contract worth € 26,000 for the structural provision of legal advice, covering the period from January 1, 2010 to December 31, 2010. 40 CertiQ 2009 Annual Report

  • Page 44

    Notes to the profit and loss accounts for 2009 (EUR) 5 Revenue During the reporting period, participants were invoiced on the basis of previously set tariffs. The amount needed to cover costs was 2,078,499. The difference in our favour between this and the invoices issued will be accumulated with differences brought forward from previous years and will be adjusted in tariffs for the years ahead. 2009 2008 Invoiced revenue 3,045,728 3,019,706 To adjust in tariffs - 967,229 - 591,365 Total 2,078,499 2,428,341 The invoiced revenue can be specified as follows: 2009 2008 Registration fees 74,700 6,475 Membership fees 235,550 160,400 Issuing certificates 655,074 752,487 Certificate transfers 259,695 356,448 Certificate cancellations 1,522,304 1,485,538 Other income 298,405 258,358 Total 3,045,728 3,019,706 Certificates The combination of reduced tariffs and a decrease in the numbers of created, imported and exported certificates led to declining revenues from issues and transfers. The rise in revenues from ‘cancellations’ is partly attributable to users voluntarily turning grey electricity to green, retrospectively. The increase in revenues from memberships is due to registrations of solar power plants. Other income The other income consisted largely of invoices for investments already made, for the implementation of the MEP and SDE schemes. 41 CertiQ 2009 Annual Report

  • Page 45

    6 Operating expenses Personnel expenses The company does not have its own employees, it hires them in. In 2009 the average number of hired staff was 12.5 FTE (2008: 11.5 FTE). These are all seconded from TenneT. The staff level at the end of the reporting year was 12.5 FTE (2008: 11.5 FTE). Personnel costs have decreased compared to 2008. This is due to reimbursements received for the time CertiQ staff spent on projects. The personnel costs can be specified as follows: 2009 2008 Hired from TenneT 695,991 710,343 Hired from third parties 40,118 42,733 Total 736,109 753,076 Costs of systems for process automation and the depreciation on tangible fixed assets Since 2006, the tangible fixed assets have been capitalised on CertiQ’s balance, whereas previously they were on TenneT’s balance sheet. The depreciation for tangible fixed assets has decreased because few projects have been capitalised. Other operating expenses The other operating expenses include all the costs of premises, consultancy fees, office costs and travel and accommodation costs. These costs have increased in comparison to 2008. This is due to the business analysis conducted for the certification system and to the customer satisfaction survey that was conducted. Interest income This item refers to the interest paid on the balance of our current account at TenneT. The increase in interest income is caused by higher average claims against companies within the group (through the current account), as compared to 2008. 42 CertiQ 2009 Annual Report

  • Page 46

    7 Transactions with associated parties This relates to transactions with TenneT TSO BV, and for 2008, also transactions with EnerQ BV. The latter was wound up on 1 January 2009, so there were no transactions with this party in 2009. CertiQ has transactions and positions with the following associated parties: TenneT TSO TenneT TSO B.V. EnerQ B.V. Total 2009 B.V. EnerQ B.V. Total 2008 Services - - - - 451,693 451,693 Reimbursements 1,378,174 - 1,378,174 1,401,364 - 1,401,364 Interest charges - - - 26,539 - 26,539 Interest received 2,587 - 2,587 - - - Current account credit 1,291,693 - 1,291,693 - 2,598 2,598 Current account debt - - - 74,295 - 74,295 Arnhem, 26 May 2010 Management of CertiQ BV 43 CertiQ 2009 Annual Report

  • Page 47

    Other information Appropriation of profits The appropriation of profits is set out in article 29 of the statutes. This reads as follows: 1. Profits will be distributed in accordance with the provisions of this article after adoption of the annual accounts showing that this is justified. 2. The profits are at the disposal of the general meeting. 3. The company may only make distributions to the shareholders and other persons entitled to the profit intended for distribution insofar as the shareholders’ equity exceeds the issued capital plus the reserves which must be maintained by law. 4. A deficit may only be offset against the reserves prescribed by law to the extent permitted by law. 44 CertiQ 2009 Annual Report

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    Auditor’s opinion [on the Dutch version of these accounts] To the shareholder and management of CertiQ BV Opinion concerning the annual accounts We have audited the annual accounts of CertiQ BV Arnhem for 2009, included on pages 35 to 45 of this Annual Report, and consisting of the consolidated and company balance sheet as at 31 December 2009, the consolidated and company profit and loss account for 2009, and the notes. Responsibility of the Management The Management of the company is responsible for the preparation of financial statements, which must faithfully represent the assets and results of the company, in accordance with Part 9, Book 2, of the Netherlands Civil Code (BW). This responsibility includes the design, implementation and maintenance of an internal control system relevant for preparing and faithfully representing the annual accounts of assets and results, in such a way that these contain no inaccuracies of material importance as a result of fraud or error; the selection and application of acceptable principles for financial reporting; and making estimates that are reasonable under the circumstances concerned. Responsibility of the auditor Our responsibility is to issue an opinion on the financial statements based on our audit. We have conducted our audit in accordance with Dutch law. Those standards require that we comply with the behavioural norms applicable to us and that we plan and perform the audit to obtain reasonable assurance that the financial statements are free of inaccuracies and material misstatements. An audit includes activities to obtain audit information about the amounts and the notes to the financial statements. The choice of activities to be performed is dependent on the professional judgement of the auditor, based in part on his evaluation of the risk of misstatements of material importance resulting from fraud or errors. For purposes of this judgement, the auditor considers the internal control system that is relevant for the preparation and fair presentation in the financial statements of the balance sheet and profit and loss account, in order to make a well-considered decision as to the audit 45 CertiQ 2009 Annual Report

  • Page 49

    activities that, under the circumstances, are adequate, but his purpose is not to produce an opinion about the effectiveness of the internal control system of the company. An audit also includes an evaluation of the acceptability of the accounting principles used for financial reporting and of the reasonableness of estimates made by the company’s management, as well as evaluating the overall presentation of the financial statements. We believe that the audit information that we have obtained is adequate and suitable as a basis for our opinion. Opinion In our opinion, the financial statements give a true and fair view of the magnitude and composition of the assets of CertiQ BV as of 31 December 2009 and of its result for 2009, in accordance with Part 9, Book 2, of the Netherlands Civil Code. Arnhem 26 May 2010 PricewaterhouseCoopers Accountants NV C. Romme RA 46 CertiQ 2009 Annual Report

  • Page 50

    Appendix: CertiQ works with ... CertiQ works actively with various interested parties in the sustainable energy sector. We would like to mention the following here: TenneT TSO BV TenneT TSO BV is the Dutch Electrical Transmission Operator and manager of the national high voltage grid. TenneT established the certification system for electricity generated in sustainable ways, and for Combined Heat & Power plants, on behalf of the Ministry of Economic Affairs. CertiQ manages this system, which is linked to TenneT’s electronic infrastructure, on behalf of TenneT. TenneT is the only shareholder in its subsidiary CertiQ. The NL Agency The NL Agency (Agentschap NL), formerly called SenterNovem, is part of the Ministry of Economic Affairs. The NL Agency implements government policies on innovation and sustainable development, and manages the SDE and MEP subsidy schemes which support the generation of renewable electricity that is certified by CertiQ. The Ministry of Economic Affairs The Ministry of Economic Affairs is responsible for policy-making for sustainable energy and Combined Heat & Power. CertiQ systematically coordinates its policies with the Ministry regarding developments that affect CertiQ. The Office of Energy Regulation The Office of Energy Regulation (Energiekamer) is the regulator for the Dutch energy sector. Among its duties are to supervise the correct implementation and compliance with the Electricity Act of 1998 and other legal schemes that are implemented by CertiQ. Regional grid operators Regional grid operators are responsible for the transmission of electricity over the public electric grid, from producers to consumers. In relation to CertiQ, the grid managers are responsible for evaluating applications for registration of generating plants and for periodically sending CertiQ their measurements of sustainable electricity and CHP electricity. 47 CertiQ 2009 Annual Report

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