​Data centres will be required to support or supply their own clean power under federal Government proposals. A key component of the mechanism involves new data centres surrendering Renewable Electricity Guarantee of Origin certificates (REGOs). This promises potential value for green certificates after the expiry of the Large Scale Renewable Energy Target (LRET) in 2031.

REGOs opened in November 2025 but early registrations and certifications have been slow. With no mandatory surrender and Large Scale Generation Certificates (LGCs) continuing until the end of 2030, only 19 MWh of REGOs have been certified so far, with 550 MW of capacity registered.

REGOs let buyers identify when renewable electricity was generated, alongside the plant and location information already traceable through LGCs. The AEMC recommends data centre requirements focus on new, time-matched certificates, prompting interest in whether future demand could reverse the current oversupply.

This article explains the outlook for generic LGC and REGO prices and how the AEMC’s proposals could drive a premium market for certificates from new plants backed by storage.

Executive summary

• Generic certificates face a widening supply surplus. Eligible generation is projected to grow by 50 million certificates to 2031, while mandatory demand falls 31 million.
• Projected new data centre demand of 21 million certificates by 2035 is unlikely to be sufficient to absorb the surplus.
• LGC futures are prices at $6-7/MWh to 2030 with further downward pressure on the shift to REGOs in 2031.
• Current AEMC proposals seek to create a differentiated market for premium certificates from new, time-matched projects.

Data centres are unlikely to mitigate the supply surplus for generic certificates

Obligations on data centres alone are unlikely to be sufficient to resolve the supply/retirement imbalance, which instead looks likely to worsen with the shift to REGOs. New data centres bring an additional 21 TWh of demand (equivalent to million MWh certificates) by 2035, but this is relatively small compared to the projected imbalance between issuances and retirements.

The sunsetting Large-Scale Renewable Energy Target (LRET) at the end of 2030 reduces mandatory surrender for renewable certificates by 30 million certificates (equivalent to TWh) annually, while the growth in renewables drives a continued increase in eligible supply. Additionally, 12 TWh of generation will become eligible to issue REGOs, which had previously been limited under an LGC baseline.

The pace of growth of voluntary certificates is the key unknown here. Voluntary demand growth has picked up in the past two years, especially as prices have declined, but not fast enough to absorb new renewable volumes.

Prices are likely to remain low for generic certificates

LGC prices have fallen as the supply of eligible certificates has outpaced surrender. Issuances closely matched surrenders in 2021/22, within 1.7 million certificates. LGC prices have declined sharply as the gap has grown to 9 TWh by 2025.

With voluntary demand held constant, the annual surplus is expected to widen through 2030. This increases further when LRET-driven surrenders end in 2031, and legacy generation becomes eligible to issue certificates.

The Modo Energy forecast for LGC prices follow futures published by the Clean Energy Regulator, ranging from $6-7 per MWh certificate through to 2030. Beyond then, the projected price for generic REGO falls to $1 per MWh, with voluntary demand the basis for a price floor.

Data centre requirements promise potential upside for time-matched certificates from new projects

AEMC’s proposed data centre obligation would create demand for a narrower pool of REGO certificates, which command a price premium. Eligibility rules determine which projects can serve that data centre demand. Time-matching rules determine whether certificates for scarce hours earn more.

A premium is possible even if the wider REGO market remains oversupplied. Its size will depend on the final rules and whether voluntary buyers also favour differentiated certificates. The AEMC’s advice remains subject to further design work.

How regulators define ‘new’ projects will determine who benefits

Current consultations suggest ‘new’ certificates should depend on when projects are built, not proof of data-centre investment dependence. One option would include projects that have not reached financial close by the time the rules take effect, even if they already hold a Capacity Investment Scheme contract.

The obligation would apply to data centres connecting after legislation is slated and rules finalised, potentially from 2028. To test a narrower pool, the chart below counts renewable supply and data centre demand added after 2027.

A surplus between eligible renewable supply and data centre demand remains even in this constrained pool of projects, limiting the case for a price premium based on project age alone. However, disqualifying 108 TWh of pre-2028 renewables offers directional price support. The market would then need less voluntary demand to bring balance.

The Central scenario expects 73 TWh of eligible renewables by 2035 against 19 TWh of new data centre demand. Under the Low scenario, supply exceeds demand by just 5–11% in 2030–32. This is the only scenario where data-centres alone could drive tightness for generic renewable certificates.

Time matching creates conditional upside for storage

REGOs carry an hourly timestamp by default, although issuers can choose a longer period. The data centre obligation’s matching rules, and where voluntary demand lands, will determine whether certificates for scarce periods earn a premium.

The current AEMC proposal promises value for storage by matching data centre demand across three time of day tiers - peak, off-peak and shoulder. Storage enables projects to retire off-peak certificates and instead produce higher value peak ones. Hybrid projects can create REGOs for renewable electricity supplied directly to its battery. Any certificate premium would likely rise in line with wider power market tightness, rather than protecting projects when spot prices fall.

What to watch from here

Three factors will determine whether and which certificates earn a premium:

• Project eligibility will set how many generators can serve data centre demand.
• Time-matching rules will determine whether certificates from scarce hours command higher prices.
• Voluntary demand will determine whether buyers compete for eligible certificates beyond the data centre obligation.

The proposals are not yet detailed enough to put a firm price on that premium. Low prices are likely to persist for other projects.