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Glossary · Energy industry & energy transition

Additionality (Additionality in Electricity Procurement)

Additionality additionality electricity purchase PPA Green power Guarantee of origin 24/7 Carbon-Free Energy Carbon footprint

Additionality in electricity procurement refers to the question of whether a decision on electricity procurement enables additional low-emission generation that would not have come into being, or would only have come into being later, without that decision. What is meant is a causal contribution, for example to financing a new wind farm. Purchasing verified renewable electricity volumes and supporting additional generation are therefore not the same thing.

What matters is the comparison with a plausible course of events without the contract under consideration. If the project would have been built unchanged anyway, its entire output cannot be attributed to the buyer alone as an additional effect. Conversely, a single offtaker does not have to be the sole cause of the construction: several offtakers, equity investors, banks and public instruments can jointly enable a project. A robust statement identifies one's own contribution rather than claiming the entire success.

Electricity volume, origin and impact are different quantities

Electricity consumption is measured in kilowatt-hours or megawatt-hours; 1 MWh corresponds to 1,000 kWh. Plant capacity, by contrast, is stated for example in megawatts. A procured electricity volume proves neither the construction of a particular additional capacity nor a particular quantity of avoided emissions. This requires additional information on the project, the comparison case and the electricity system.

A guarantee of origin documents the renewable origin of a quantity of electricity generated. It can be traded separately from the electricity. For German electricity labelling, the certificates used are cancelled in the guarantee of origin register so that the same renewable attribute is not marketed more than once. However, the certificate is not an assessment of the additional environmental benefit of an electricity product and is not evidence of plant construction triggered by the buyer.

In the public interconnected grid, no exclusive physical path from the power plant to the socket can be derived from a supply contract. Contractual attribution nevertheless remains useful: it clarifies who may claim which generation attributes. Additionality poses a different question, namely what actually changes as a result of the demand.

When an electricity contract makes an additional impact plausible

A PPA, Power Purchase Agreement, is a usually long-term electricity offtake contract. For a new-build project, it can create predictable revenues and thereby facilitate financing. The contract designation alone, however, does not prove additionality. PPAs with existing plants are also possible; likewise, new plants can be economically viable even without the specific contract under consideration.

A simplified example illustrates the assessment: a project company receives a loan only if a substantial part of its future revenues is secured. A company concludes a suitable offtake agreement before the final investment decision. This points to a financing contribution. If, by contrast, it only buys certificates from the same plant at short notice after completion, this does not explain the earlier construction. Even in the first case, it would need to be examined whether other offtakers would readily have stepped in.

State support is neither a blanket reason for exclusion nor proof of additionality. What must be examined is which financing gap, price risk or investment barrier the private contract actually influences. The statement "unsubsidised" replaces this comparison just as little as the statement "newly built". A new-build project that is highly profitable anyway may show a smaller additional procurement contribution than a project whose realisation depends on reliable offtake.

An impact is also not categorically ruled out for existing plants. Accelerated expansion, modernisation or economically necessary continued operation are conceivable. However, these are different impact claims from the financing of a new build. Anyone claiming continued operation, for example, would have to show plausibly that the plant would actually have been decommissioned without the contract and would not merely have found another buyer.

Corporate accounting and avoided emissions

Market-based Scope 2 accounting allocates emissions to companies on the basis of suitable contractual instruments. The 2015 Scope 2 Guidance requires quality criteria for this, but no general proof of additionality in the manner of an offsetting project. Low market-based electricity emissions therefore do not automatically prove a corresponding reduction in the emissions of the entire electricity system. Avoided emissions relative to a comparison case must be examined separately from corporate accounting.

As of 11 November 2026, the Scope 2 framework is under revision. The interim status published on 16 October 2026 addresses, among other things, hourly matching, spatial deliverability and requirements for newer generation plants. These discussed changes are not to be equated with requirements that have already been finally adopted. For every accounting statement, the version of the standard applied should therefore be stated.

Temporal and spatial matching

Annual coverage says little about what supply remains necessary in individual hours. A hypothetical facility consumes 10,000 MWh per year and procures the same annual quantity from a solar plant. The annual quantity is thus covered arithmetically, but not automatically the night-time consumption. Additional solar generation and temporally matched supply are two separate assessment tasks.

24/7 Carbon-Free Energy aligns procurement with hourly coverage, as far as possible, by low-CO₂ or, in operation, CO₂-free sources. This can create incentives for a more diversified portfolio. However, temporal matching in itself proves additional investment just as little as annual coverage does. Conversely, an additional wind farm can have an expansion effect without covering its offtaker's consumption in every hour.

Location also matters: grid connections and bottlenecks influence which generation can supply additional consumption or replace other power plants. Geographic proximity alone, however, guarantees neither free grid capacity nor a particular emission reduction. The effect of additional feed-in depends, among other things, on power plant dispatch, possible curtailment and the residual load. Storage and flexibility can improve temporal matching; however, storage does not generate additional primary energy and causes conversion losses.

Special case: renewable hydrogen

Electrolysis creates additional electricity demand. If it is merely allocated existing renewable volumes, more fossil generation may become necessary for other consumers. EU Regulation 2023/1184 governs when electricity for renewable fuels of non-biological origin, in particular corresponding hydrogen, counts as fully renewable. It is not a general additionality rule for all green electricity tariffs.

For the regular grid-based PPA proof pathway, requirements on plant age and support as well as temporal and geographic correlation generally apply. The generation plant may as a rule have entered operation at most 36 months before the fuel plant. For fuel plants put into operation before 1 January 2028, the requirements under Article 5(a) and (b) are suspended until 1 January 2038; capacities added later do not benefit equally. Further proof pathways and exceptions must be observed. The additionality criterion for green hydrogen explains the details.

How an impact claim can be verified

For a comprehensible procurement decision, buyers and suppliers should answer at least the following questions. They are a practical checking aid, not a uniform statutory catalogue of criteria:

  • Comparison case: What would presumably have happened without the contract? Which documents support this assessment, and which uncertainties remain?

  • Project contribution: Were new build, extension or continued operation supported? When was the contract concluded, what revenues does it secure and which risks does the buyer assume?

  • Evidence and accounting: Are the claimed generation attributes clearly allocated? Are guarantees of origin, accounted emissions and claimed avoided emissions kept cleanly separate?

  • System impact: Do generation and consumption match in time and location? What role do support, grid bottlenecks and alternative offtakers play?

Additionality is therefore not a blanket quality seal. A company can correctly procure renewable electricity volumes without having triggered a new build. A precise statement is then, for example, "renewable origin verified". The further statement "enabled additional expansion" needs its own justification. A specific quantity of avoided CO₂ furthermore requires a transparent impact calculation.

Sources

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Edited by eCMS on 11.11.2026 13:58

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