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50 Shades of Green Energy Suppliers

50 Shades of Green Energy Suppliers

Right, so, energy isn’t quite as exciting as 50 shades of grey but it’s more important.

Market Context

The number of green tariffs on the market has rapidly increased over the last few years. This is largely down to increases in renewable generation and a decline in the use of coal. A vitally important increase to decarbonise our electricity grid if we want to reach net zero by 2050. Choosing a green tariff will help to contribute to an increased consumer demand for green energy and encourages your supplier and the wider industry to invest further in green energy sources.

What is green energy?

Green energy and green tariffs mean some or all of your electricity comes from a variety of renewable energy sources such as wind, solar and hydroelectric. It is a term that is used widely, but it often can have a different meaning. This can make it confusing and often not clear what energy you are buying.

Most energy suppliers and price comparison websites define a ‘green energy’ tariff as one that comes from 100% renewable energy, however, a few suppliers and tariffs just use the word ‘some’ to define the amount that comes from renewable energy making it very difficult to know what % shade of green your energy is. For a tariff to be 100% green, every Megawatt hour (MWh) of electricity you have bought is matched with a Renewable Energy Guarantee of Origin (REGO) certificate, which proves the electricity is certified as being sourced from renewable energy.

However, there are different ways a supplier can obtain these REGOs, with some greener than others.

  1. Own their own renewable assets and sell their own renewable electricity they have generated. This is very green.
  2. They have PPA or direct arrangements with renewable generators. These are good as the renewable generator will receive this revenue and it provides a route to market which supports future renewable development. Electricity bought via these arrangements will usually come with associated REGOs.
  3. Buy REGO’s off the secondary market where they are in excess and are traded and sold. This does provide revenue for the supplier, but it doesn’t consider time of use so isn’t directly related to the supply you will receive. This is not as green as the first two.

Some green energy suppliers neither generate renewable energy or have contracts with generators to buy renewable energy and instead rely on purchasing REGO’s off the secondary market. Whilst this is still okay, it is clear there are very different shades of green as some suppliers will do a lot more for future renewable energy generation than others.

How green is my supplier?

To know how green your supplier is, check their fuel mix/fuel disclosures which are easily accessible on their website and try to find out how they secure their renewable energy.

If you are with an energy supplier that is not 100% green but you are on a green energy tariff that is still good as it should encourage them to invest more in renewable electricity! However, if you are not on a green tariff, why not think about switching to a green energy tariff if you want to help turn your energy from light green to dark green and you could probably save some money switching too!

What about Nuclear Energy?

Nuclear is not usually included in the green energy definition as it is not renewable. However, nuclear is low carbon and can provide stable always on electricity which can complement renewables to help decarbonise the energy grid. Should it be included?

So, what is Green Energy?

Green energy is energy that comes from renewable sources. There are a number of green tariffs and some provide more commitment to the green movement than others depending on how your supplier secures their green energy. Unfortunately, there is still a lack of transparency in the market for us consumers but I hope now you understand the difference and can make a truly green choice.

One Response

  1. David Gilmour says:

    Insightful blog and good to see we can have a forum to start to speak about all the choices we can and cant make. It will be really good to see other suppliers using the platform so we can all get a better understanding of the impact of the choices we make

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