Buying green electricity
Where your electricity comes from, green supply tariffs and the Green Energy Supply Certification Scheme.
Most of of the UK's electricity comes from burning fossil fuels (such as coal, oil and gas) which is a major contributor to climate change. Carbon-free sources, including nuclear and renewables, account for around a quarter of total electricity production.
Renewable or 'green' electricity accounted for just 6.7% in 2009, but the proportion is growing steadily. This increase is due to policies such as the Renewables Obligation (find details of the Renewables Obligation at the OFGEM website) and the Feed-In Tariff , which support new renewable generation, as well as reductions in total electricity demand, which make the existing renewable contribution go further.
The Government wants at least 30% of our electricity to come from renewable sources by 2020.
Most energy suppliers offer 'green' electricity tariffs. These seek to support renewable energy. The two main types of offering are green supply tariffs and green funds.
Green supply tariffs
A green supply tariff means that some or all of the electricity you buy is 'matched' by purchases of renewable energy that your energy supplier makes on your behalf. These could come from a variety of renewable energy sources such as wind farms and hydroelectric power stations. Your supplier should let you know what sources are included in the mixture, and also what proportion of your supply is renewable.
Many green tariffs state that your supply is renewable but they simply assign some of the renewable energy they are already required to supply to you, while reducing the amount of renewable energy they provide to other customers. This does not increase the amount of renewables in the overall energy mix.
Some companies will guarantee that a proportion of the renewable energy they are purchasing (and you are buying) is 'additional' - it is above and beyond what suppliers are already required to produce. This creates an additional incentive to develop new generation capacity and so could lead to increased renewable generation and reduced carbon dioxide emissions.
There are no companies offering green tariffs that are 100% additional renewable supply.
A green fund usually involves paying a premium to contribute to a fund that will be used to support new renewable energy developments. Under this option, the existing electricity supply continues as normal, but your involvement could help to alter the mixture of energy sources in future toward renewable sources (depending on the type of tariff).
The new generation projects supported may also receive support under existing government support schemes.
In February 2010, the Green Energy Supply Certification Scheme was launched. This scheme was set up to reduce customer confusion and mis-selling in this marketplace. These tariffs have been independently checked, and meet the energy regulator Ofgem’s Green Energy Supply Guidelines. Find out more on the Green Energy Supply website.
But although these tariffs demonstrate real carbon savings, they do not ensure that the electricity you buy is 100% renewable or that it creates additional renewable energy generation.
In order to comply with the scheme, suppliers must 'match all the energy you use with Renewable Energy Guarantees of Origin (REGOs). REGOs are certificates attached to electricity produced from renewable sources. These can be bought from any EU member state.
But the claim of 'matching' the energy you buy with renewable energy does not necessarily mean that you are increasing the amount of renewable energy produced in the UK or abroad. The supplier only has to show that they have purchased enough renewable energy to supply it to all their customers who have signed up to their Green Tariff. Suppliers are already obliged to supply a certain amount of renewable energy regardless of whether you sign up to a green tariff.
The supplier must also do at least one of these:
- Carbon offsetting so long as it is certified under either DECC’s Quality Assurance Scheme for Carbon Offsetting (QAS) or the Gold Standard for regulated credits. This could include for example the provision of fuel efficient stoves abroad. If offsetting is done through the QAS, 1.8 tonnes of CO2 must be offset. If offsetting is done through the Gold Standard 1 tonne of CO2 must be offset.
- 'Additional activities' which could include energy efficiency measures such as cavity wall and loft insulation, and advice (as long as these savings are measurable and not being claimed for under other schemes which place obligations on electricity suppliers). At least 50kg of CO2 per customer per year must be saved through this method.
- Green Fund that could be used to invest in measures such as renewables on community buildings. At least 50kg of CO2 per customer per year must be saved through this method.
- Other activities accepted by the assessment panel.
This is a voluntary scheme and not all suppliers or tariffs are required to use it. However, all suppliers who have joined the scheme can no longer market other non-certified tariffs as 'Green'.
- Opting for a green tariff will not mean that the electricity you buy is all renewable. You cannot consider that your electricity supply is zero carbon or carbon neutral.
- Opting for a green tariff can provide additional incentives for new renewable generation or energy efficiency measures, and so lead to some additional carbon dioxide savings in the long term.
- If you opt for a Certified Green Energy Supply, then there will be some guaranteed additional benefit. However, this could be as little as 50 kg carbon dioxide saved per year, or around 2% of the average household’s carbon dioxide emissions from electricity use.
- Green tariffs are no substitute for energy efficiency – you should always do whatever you reasonably can to reduce your current use of electricity and other fuels before considering spending money on a green tariff.
The Energy Saving Trust does not recommend specific suppliers of green tariffs.