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Glossary · Energy industry & energy transition

Guarantee of Origin (Herkunftsnachweis, HKN)

Guarantee of origin GO Green power electricity labelling renewable energies electricity market Balancing and settlement

A guarantee of origin, abbreviated HKN in German (Herkunftsnachweis), is an electronic document. Its sole purpose is to prove to an end customer that a certain share or quantity of energy was generated from renewable sources. EU law calls the instrument a Guarantee of Origin, see Guarantees of Origin. The standard size is one megawatt hour, and at most one certificate may be issued for each unit of energy produced. Besides electricity, the EU Renewable Energy Directive can also cover gas, including renewable hydrogen, as well as heating and cooling. This entry deals mainly with electricity HKN and the legal situation in Germany.

An HKN contains mandatory information. This includes the energy source, the start and end of the production period, the name, location, type and capacity of the installation, the date of commissioning, whether and to what extent the installation received support, the country of issue and a unique identification number. In Germany, an HKN is issued for a quantity of electricity of one megawatt hour that was generated and supplied to final consumers. The German Environment Agency (Umweltbundesamt, UBA) compares the certificate to a birth certificate: it certifies how and where the electricity was generated. It does not contain an assessment of ecological quality.

Accounting allocation instead of a physical electricity trail

In the electricity grid, it is not possible to trace where electricity comes from. Electricity from wind, sun, water, nuclear power or coal flows together, and all feed-ins and withdrawals jointly affect voltage, frequency and load flows. A household with a green electricity tariff physically draws the same electricity as its neighbour without that tariff. The HKN does not change this. It intervenes neither in grid operation nor in power plant dispatch. It allocates the renewable attribute of a generated megawatt hour, in accounting terms, to a particular consumption. According to the UBA, it is then guaranteed that the quantity consumed was generated from renewable sources, but not that exactly this electricity comes out of one's own socket.

An everyday analogy: electricity is like water in a large shared lake, and the HKN is like an entry in a land register. Whoever feeds in adds water to the lake. Whoever cancels HKN has the register certify that a corresponding quantity was fed in from renewable sources and not attributed to any other customer.

Life cycle: issuance, transfer, cancellation

An HKN is issued after generation in the register of the country in which the installation is located. It can then be transferred, also across borders, and at the end it is cancelled. How this works is described in the entry HKN cancellation. Cancellation is the decisive step. A cancelled certificate cannot be used again, so that the same megawatt hour cannot be sold several times as green electricity. Under EU law, an HKN can be transferred for twelve months from generation. Certificates that have not been cancelled expire at the latest 18 months after generation. For disclosure purposes, energy companies must cancel them at the latest six months after the end of their validity.

In Germany, the Umweltbundesamt maintains the register of guarantees of origin. It issues, transfers, imports, exports and cancels the certificates. Issuance, transfer and cancellation take place electronically in accordance with the standard DIN EN 16325. The UBA recognises foreign certificates upon application. A German tariff can therefore be backed, in accounting terms, for example by Norwegian hydropower. Under Section 79 of the Renewable Energy Sources Act (EEG), HKN are expressly not financial instruments within the meaning of banking law and securities trading law. Important in practice: in the German register, only electricity suppliers that supply final consumers may cancel HKN, and only for their electricity labelling. Companies or municipalities cannot cancel cheaply purchased certificates there themselves in order to improve their carbon footprint on paper.

Support and ban on double marketing in Germany

The EU directive allows Member States not to issue HKN to producers that receive support. Germany has made use of this option. The UBA issues certificates only for electricity for which no payment under Section 19 or Section 50 EEG is claimed, that is, for example, no market premium or feed-in tariff. In addition, the ban on double marketing under Section 80 EEG applies. Anyone who receives an EEG payment may not pass on guarantees of origin for that electricity. Conversely, the entitlement to payment lapses if certificates are passed on. An exception is regional certificates under Section 79a EEG. They can be issued for supported, directly marketed electricity and prove only the regional origin.

This rule is intended to prevent electricity whose support is paid for by the general public from being sold twice. Previously this financing ran through the EEG surcharge, and it now runs through the federal budget. The renewable attribute of such quantities is not to be sold again as an exclusive green electricity product. Anyone in Germany who wants to declare unsupported renewable electricity must cancel HKN in the UBA register for this purpose. In electricity labelling, this share appears as renewable energy with guarantee of origin, not supported under the EEG.

Distinction from supply contract, green electricity tariff and emissions trading

An HKN is not an electricity supply contract. The electricity supplier can buy the electricity on the wholesale market and procure the certificates separately. These are then called unbundled certificates. However, it can also obtain both together from one installation, for example through a Power Purchase Agreement. The German implementing ordinance expressly provides for bundled supply in this case. A green electricity tariff can also contain more than HKN, for example commitments on building new installations, on regional generation or on simultaneous matching of supply. According to the UBA, only green electricity labels provide an ecological assessment going beyond the certificate.

An HKN is also not a CO₂ allowance and has nothing to do with emissions trading. It does not entitle the holder to emit greenhouse gases and does not offset emissions. In corporate accounting under Scope 1, Scope 2 and Scope 3, it can nevertheless play a role in the market-based method. Separate rules apply to this, which go beyond the labelling obligation.

Additionality and price signals

It is often assumed that an HKN automatically brings additional benefit for the climate. This is not correct. The certificate proves how electricity was generated. It does not prove that investment was made for it. If the certificates come from old, fully depreciated hydropower plants, they are often cheap. They then give investors hardly any incentive to build new installations. More impact is possible if certificates come from new, unsupported installations or are part of long-term contracts that finance such installations. A low price therefore does not mean that renewable electricity is worthless. It shows above all that there are many certificates and little demand for particular quality features. The HKN price in any case does not reflect costs for grid expansion, storage or firm capacity. For hydrogen, EU law has its own, stricter criteria, see additionality criterion for green hydrogen.

Temporal and spatial limits

An HKN applies to a specific production period. Electricity labelling, however, aggregates the certificates for a whole year. An annual mix from hydropower therefore says little about whether consumption on a windless winter evening was actually covered by renewables. For grid operation, the residual load and the need for flexibility, by contrast, it matters when and where electricity is fed in and consumed. The EU directive as amended in 2023 relates the time information for electricity HKN to the imbalance settlement period, that is, to much shorter time intervals. Voluntary procurement models in part already require monthly, daily or hourly matching of generation and consumption. Such certificates say more and fit better with storage operation and real generation profiles.

In brief

  • An HKN generally represents 1 MWh of energy generated from renewable sources and is cancelled upon use. This ensures that the same quantity is not counted twice.

  • In Germany, HKN exist only for electricity without EEG payment. Only electricity suppliers may cancel them in the UBA register, and only for electricity labelling.

  • An HKN proves the origin of a quantity of electricity. It proves neither physical delivery nor simultaneous supply nor the construction of additional installations.

Sources

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Edited by eCMS on 12.11.2026 05:05

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