In recent years, renewable energy tariffs have become increasingly popular. In response to this demand, more suppliers are now offering green tariffs. Recent research has shown that over half of the 355 tariffs on sale in June 2019 boasted renewable electricity credentials whereas in 2016 the figure was just 9%. Further research however shows that some companies selling ‘green’ energy aren’t being 100% transparent, marketing themselves as ‘green’ despite the fact that they don’t own any renewable energy generating assets such as wind turbines or solar panels and instead having deals in place to purchase power from companies that do have these renewable assets.
As would be expected, some suppliers appear to be supporting the move to a greener future more wholeheartedly than others. To boost their ‘green’ credentials some suppliers make ongoing donations to sustainable community groups such as planting a tree for every energy contract sold
It used to be the case that ‘green’ energy tariffs were much more expensive than their non-green counterparts. As time has gone on, the UK’s renewable energy network has expanded, and smaller ‘green’ energy suppliers have emerged. This, combined with increasing public concern around climate change has put pressure on the large energy suppliers to reduce the costs of their ‘green’ tariffs, making the choice to go green a much easier one!
When choosing a tariff, you may be faced with a number of terms you aren’t familiar with, we will explain these below;
Power Purchase Agreement: A power purchase agreement, or electricity power agreement, is a contract between two parties for the purchase of electricity. Suppliers that don’t own wind turbines or solar panels may use these contracts to buy ‘green’ energy from other suppliers that they can then sell on in their ‘green’ tariffs.
REGO certificates: The Renewable Energy Guarantee of Origin scheme aims to provide transparency to consumers about the proportion of electricity that suppliers source from renewable generation, so you can be sure that suppliers aren’t exaggerating their green credentials. All EU Member States are required to have such a scheme.
Green washing: Also referred to as green sheen, this is a deceptive marketing spin in which companies use the fact that they are green and sustainable in some parts of their business or operations, in order to persuade consumers that their organisation’s aim, objectives and missions are environmentally sustainable.
Green funds: This is a premium paid to contribute to renewable energy and environmental projects such as the planting of trees, sustainable community projects and carbon off-setting.
Brown electricity: This is a term used to describe electricity generated from non-renewable sources such as coal or gas.