Dr. Erich Merkle
The distinction between green electricity from renewable sources and grey electricity from fossil or nuclear generation is central to the energy transition. It affects climate policy, corporate strategy, and consumer protection alike. Yet the system designed to safeguard this separation is vulnerable to misuse. Without precise verification and allocation mechanisms, we risk a scenario in which “green” exists largely on paper – and greenwashing becomes the norm.
Certificates: Legally Correct, Practically Decoupled
In practice, proof of origin today is almost exclusively provided through digital certificates such as Guarantees of Origin (GO), Renewable Energy Certificates (REC), or national registries. These documents indicate, on paper, where electricity comes from – yet they are often decoupled from the actual location and time of generation.
A particularly problematic case is that of so-called unbundled certificates: here, green electricity is allocated on paper without any actual renewable power flowing to the end consumer. A company can officially claim to use 100% green electricity, while the physical mix coming out of the socket still contains fossil energy. Legal, but misleading.
Overbooking, Double Selling, and “Phantom Certificates”
In several markets, more certificates have been sold than renewable energy was actually produced. Causes include faulty IT systems, insufficient auditing, poor registration practices, and a lack of synchronization between international systems. This leads to phantom certificates that do not correspond to any real power flow. The financial incentive to manipulate grows – along with the risk that investments in green power certificates bring no real climate benefit.
Real-World Fraud Cases
Across Europe, there have been cases where certificates were issued for facilities that never operated, or where the same generation was sold multiple times. In the field of electric mobility, charging stations have been marketed as “green” even though the supplied electricity was not from renewable sources. Criminal proceedings and damages in the millions show that these are not merely theoretical risks.
Battery Storage and the Exclusivity Principle
With the expansion of solar PV, battery storage is coming increasingly into focus. In principle, a storage unit with a grid connection is permitted – the Federal Network Agency must allow the connection.
However, under the Renewable Energy Sources Act (EEG), the exclusivity principle applies: as soon as a storage unit also takes in grey power alongside solar energy, the stored green electricity loses its eligibility for subsidies. The installation remains legal, but can no longer be certified as a “green power storage” unit.
The EEG 2024 introduces two new calculation options:
- Segmentation Option – precise technical measurement of which energy volumes are green and which are grey. High effort, mandatory by 2026 at the latest.
- Flat-Rate Option – simplified, standardized values based on storage size and capacity. Useful when measurement budgets are small.
Both methods are intended as transitional solutions until a unified, technically and legally robust system is in place.
The Core Problem: No Physical Link
The greatest structural deficit is that digital certificates are not physically linked to the actual flow of electricity in the grid. This creates several risks:
- Incorrect or duplicate bookings
- Multiple sales of the same electricity volume
- Poor or missing audits
- International synchronization gaps
Such weaknesses invite fraud and greenwashing – and undermine trust in the effectiveness of the energy transition.
Pathways to a Fraud-Proof System
To safeguard credibility, improvements are needed in technology, regulation, and communication:
- Technical Innovation
Blockchain-based systems could document every kilowatt-hour generated with a time and location stamp, store it immutably, and make it verifiable at any time. - Data Integrity
Linking smart meter data with digital signatures and automated quality checks to detect faulty or duplicate certificates early. - Regulatory Measures
Mandatory external audits, stricter verification processes, and international harmonization to control cross-border certificate transfers and consistently sanction abuse. - Transparency for Consumers and Businesses
Clear labelling to indicate whether a green power claim is based on physical delivery or merely on accounting allocation.
The Current System Is Too Easy to Manipulate
If some markets sell more green electricity on paper than is actually produced, this is a direct attack on the credibility of the energy transition.
The solution lies in a closer connection between digital verification and the physical power flow – combined with modern metering technology, blockchain, real-time auditing, and clear international standards.
Only then can we ensure that “green” really means green – and that greenwashing is no longer a profitable business model.
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