Since April 2002, it has been a legal requirement enforced by the Government that British electricity providers have to supply more energy they sell from renewable sources. In 2008-2009, this was 9.1%, but is expected to rise to 15.4% in 2015-2016, and staying there until around 2026-2027. However, there are talks going on at present, to increase this percentage further.
Green Tariffs
Many green tariffs on the market will state that they supply 100% green electricity, but this is not always the case, as they may just aim to meet their legal obligation instead. A green tariff doesn’t necessarily mean that the energy provided to your house is
directly
generated from these green sources. But it will often signify that the supplier simply matches your demand against the creation of energy from a renewable source. However, sometimes the supplier invests in a wind turbine or another project in order to offset any household CO2 emissions.
There are 3 main types:
Green source tariffs mean that the energy company will guarantee to purchase a set amount from a renewable generator that uses a renewable energy resource, per every unit of electricity you buy.
Green fund tariffs are where the provider does not buy renewable energy directly, but support a construction of wind farm for example, which creates more renewable energy.
Green fund tariffs of other types, mean that the supplier will support environmental research projects or offer donations to offset any CO2 emissions which the company’s customers create.
Good Energy, Green Energy UK, and Ecotricity are all companies which only offer green tariffs. Others like British Gas, EDF Energy, E.On, npower, Scottish and Southern Electricity and ScottishPower, offer both green and brown electricity.
Good Energy is a great example of a corporation with a strong focus on creating demand, via selling 100% renewable-generated energy to all of its consumers but then leaving 5% of the associated Renewable Obligation Certificates from the market, way above its legal obligation.
Ecotricity has an aim of increasing supply, and promising to spend a pound on building new green electricity sources for each pound one customer spends on their bill. It doesn’t retire ROCs, but sells them instead, which allows them to invest in capacity. They feel this is more beneficial than increasing the demand.
Suppliers can be rewarded depending on their level of ‘green tariffs’, with accreditations of either gold, silver or bronze accreditation for green tariffs.
At the moment, only one percent of us use a green tariff, and the reason for this may be that it can be hard to understand and compare the environmental claims of each provider. However, the new grading system will allow consumers to assess each one’s credibility and advantages much more easily, without having to do loads of research on a number of different deals.