Guaranty of origin

Icelandic companies that produce electricity can sell guarantees of origin both to domestic parties and to European parties and have done so since 2011. Orkustofnun has the task of calculating the origin of electricity in Iceland according to energy sources along with other related issuance of guarantees of origin. According to the law, Landsnet is tasked with issuing guarantees of origin in Iceland.

If guarantees of origin are sold to foreign parties in Europe, the equivalent amount of electricity must be imported in the same proportions as the composition of electricity production in Europe. This is done to prevent double counting of the same energy units. This is the explanation for the fact that the source of electricity in Iceland consists of renewable energy, fossil fuels and nuclear energy, since the composition of electricity in Europe is only to a small extent renewable electricity. Icelandic electricity buyers should receive information about the source of electricity on or with their electricity bill once a year, cf. regulation no. 757/2012 on the publication of information related to source guarantees of electricity.

Guarantees of origin for electricity are so that the energy seller can assure the energy buyer that energy has been produced with renewable energy sources. Buyers of guarantees of origin are those who see their benefit in supporting electricity production from renewable energy sources and thus strengthen their image by purchasing guarantees of origin of electricity.

Attention is drawn to the fact that, despite the calculated origin of electricity in Iceland, Icelandic electricity is almost all produced from renewable energy sources.