The Price of Participation: Navigating the New GO Cost Recovery Landscape

As the landscape of the Australian energy certificate industry shifts, staying ahead requires more than just adapting – it requires a critical lens to ensure broad adoption and longevity. Today, we’re sharing an exclusive op-ed from our CEO, Aaron Jenkins, who dives into Guarantee of Origin program and where it sits within the renewable energy certificate markets.

Earlier this week, the Clean Energy Regulator (CER) released a request for consultation on the cost recovery methods for the broader Guarantee of Origin (GO) program. This move comes at a pivotal moment for us at Ecovantage. As recently announced by the CER, we are proud to have been the first entity to create Renewable Electricity Guarantee of Origin (REGO) certificates under the program for a site we manage in NSW. Since that announcement, we have engaged in many interesting conversations and have been approached by several stakeholders with two recurring questions: Why did you do it, and are they actually worth creating?

The answer to both is fundamentally linked to the current state of our established Renewable Energy Certificate (REC) markets. The decision to participate in the GO program came because the LGC market has effectively reached a point where it no longer delivers viable project additionality. With LGC prices at record lows, the market is failing its primary purpose. Unless we see a drastic recovery, specifically a sustained move back toward a $20+ spot price mark, the LGC framework is essentially redundant for new and existing projects. 

Exploring a potential replacement market was both a logical next step and a necessary one.

Whilst the value proposition for REGOs remains opaque, the likelihood of a REGO being worth over $20/MWh must be acknowledged as slim. This is primarily because the Federal Government has opted for a completely voluntary program. Without a mandated liability to underpin demand, there is an extreme risk of creating a broader version of the same structural problem that crashed the LGC market, a legislated demand too small to influence market pricing.

In this context, the draft Cost Recovery Implementation Statement (CRIS) for 2025/26 makes for compelling reading for organisations like ours. It outlines how the government intends to fund the program’s administration and, more importantly, reveals its expectations for participation. The CER forecasts that 81 entities will register 133 facilities for REGOs in the FY26 period. Considering there are currently only two facilities registered, including our own, this is an ambitious ramp-up. What is more telling is the assumption that these 133 sites will deliver 9.2 GWh of renewable energy annually. If we assume this comes from solar generation only, this implies an average facility size of 40 to 60MW.

Whilst we expect government-owned Hydro and utility-scale Wind Farms to opt in, this raises a critical question around whether the program is intended only for utility-scale assets.

It certainly appears that the framework is being built for large-scale players, potentially those already bolstered by the Capacity Investment Scheme (CIS).

And if so, this leaves a glaring gap in the support for Australian businesses wishing to decarbonise via behind the meter assets, such as commercial rooftop solar or BESS.

The intention of the CER’s draft paper focuses on the wider GO framework. While REGOs are front of mind, the detailed cost recovery models for the expansion into Hydrogen, Sustainable Aviation Fuels, Green metals, and Biogas via technologies like Anaerobic Digestion are equally telling when pulled apart. The draft assumes 21 facilities registered in the FY26 period will create a combined 3.2 million certificates. This is highly unlikely given that we are in May 2026 already, and there is currently no ability to register a facility, though it shows an expectation that each facility will create 152,000 certificates or an assumed 548TJ of biomethane. This is massive, and is several times larger than Australia’s current reference project, the Malabar Biomethane Project in NSW. Perhaps this is why the draft proposes a static annual fee of $8,166 per facility, plus a certificate creation fee of $1.78 per unit.

While these fees may cover regulatory administrative overheads, they pose a significant barrier to entry for facility level anaerobic digesters that are desperately needed for Australia’s fuel independence and productivity.

How does a mid-sized project, that may not even reach 10% of the scale modelled, benefit from such high overheads to create a certificate that carries no legal requirement for purchase? How do we give would-be investors the confidence to proceed? If this certificate value is pegged to the current anaemic LGC market or the yet to be valued GreenPower certificates, the proposed GO framework is all but certain to be unable to bolster new activity.

The fundamental goal of any well-planned certificate program is a principle pulled directly from the Kyoto Protocol, “additionality.” Certificates must be traceable, robust, and valuable enough to be trusted and used by purchasers, whilst also financially valuable enough to motivate a project developer into action by creating a tipping point on a business case in favour of positive action. As we move into this next experimental phase in Australia, we are left with significant concerns and questions. 

• • Will the Commercial and Industrial (C&I) sector receive any meaningful support for solar, battery, or biogas projects anytime soon? 
  • Are we entering a framework that lacks the teeth to drive new decarbonisation projects? 
  • Has the system been designed to inadvertently exclude everything except utility scale participation?

The CER is currently seeking feedback on the Draft GO Cost Recovery Implementation Statement. We encourage all stakeholders to review the proposed fees and participation models to ensure the C&I sector is not left behind in this transition.