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How to buy renewable electricity

Posted by Cathy Debenham on 8 April 2010 at 10:18 am

Until recently the electricity market was flooded with 'green' tariffs, usually for a premium price, with no clear indication of what made them 'green'. Were they just packaging up the renewable energy that they are obliged  to produce under the government’s Renewables Obligation and selling it on at extra profit, or were they actually doing something extra to lower the emissions of carbon dioxide into the atmosphere? It was difficult to tell.

Earlier this year the Green Energy Supply Certification scheme was launched to "provide transparency and clarity on green electricity tariffs". It acts as an independent check that green schemes meet Ofgem's green energy supply guidelines.

In essence that means that:

  • the electricity will match - either generate, or buy in from others - the amount of renewable electricity you buy from them
  • the company will deliver additional environmental benefits (these are specified by the scheme)
  • and an independent panel will enforce the rules on transparency and annual audits.

While this is a huge improvement on the previous free for all, we're not quite convinced by it. The products offered by the market leaders at what we'd describe as the darker green end of the market are not included in the new certification scheme. They take very different approaches, but ones we'd argue are both valid, and ones that we prefer to a green tariff offered by the big energy companies:

Good Energy focuses on creating demand for renewable energy by selling 100 per cent renewable energy to all its customers. It retires a percentage of the renewable obligation certificates (ROCs) it receives for that energy from the market (although this is currently under review since the new scheme was introduced). This means that the ROCs can’t be sold to meet another company’s obligation, which leads to an increase in the proportion of green electricity generated. Good Energy also supports microgeneration by offering an attractive package to people who want to sell any excess electricity that they produce.

Good Energy will knock £25 off the first bill for all YouGen visitors who switch to them (disclosure: we also benefit from a £25 affiliate payment).

Ecotricity’s focus is on increasing supply. Its New Energy tariff provides just under 50 per cent renewables, generated from its own turbines. The rest is ‘brown’ electricity bought on the market. It aims to increase the green share by about 10 per cent a year by building more sources of green electricity. It also offers New Energy Plus which is 100% green - the top up is bought in.

(Disclosure: All YouGen visitors who switch to  Ecotricty we will benefit from a £25 affiliate payment). 

Since the Green Energy Certification scheme was introduced Good Energy has launched a new Green and Gold tariff, which is the only product not supplied by one of the big six to gain certification. As well as sourcing all its supply from 100% renewable sources it also invests in gold standard certified emissions reduction projects. It is currently reviewing its original tariff (now called 100%) and the system of retiring ROCs.

At YouGen we use Good Energy's Homegen (original) scheme and don't intend to change to the Green and Gold. What we want is transparency, rather than a one size fits all. We like Good Energy because of its support for microgenerators, but think that Ecotricity's focus on putting money back into building more wind is also valid - and it's good to have a choice of approach.

If we had to have one size fits all, we'd prefer go with 100% renewable plus Bryony Worthington of Sandbag's suggestion of additionality provided by retiring carbon emission permits.

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Comments

1 comments - read them below or add one

sam

samComment left on: 11 September 2013 at 10:10 pm

Cathy,

thanks for the article. I would be interested in your take on the Coop energy: the last time I looked they appeared to also have 100% green supply which seemed to deserve a mention. They were also quite a lot cheaper which gave them the edge over Good energy.

The other point was about the distinction between Ecotricity (and their deep green tarrif) and Good Energy. The claim made by Ecotricity was always that they invested their cuspomers money in building new supply. This did not mean in spending money on buying forward contracts but, rather attractively, building stuff themselves. Given that we want to expand the market, this always appealed rather.

It may have changed, but I'd be interested in your thoughts.

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