Energy Minister Anne-Marie Trevelyan announced that the government will be reviewing how energy retailers’ market ‘green’ electricity tariffs to consumers. The announcement came yesterday following concerns that electricity suppliers may be guilty of exaggerating how environmentally friendly their products are.
According to BEIS nearly 9 million households in Britain are now on energy deals deemed ‘green’ or ‘100% renewable’. However, there have been apprehensions about the legitimacy of these arrangements, with consumer groups such as Which? cautioning that they may be misleading customers about the alleged environmental benefits of their deals.
Though some energy companies that market their product as a green deal, such as Good Energy, have direct agreements with solar and wind farms to match all the electricity they provide to customers, many other companies’ energy comes from the wholesale market. This means that, instead of coming directly from a green power generator, their energy could actually be coming from sources like coal or gas-fired power stations.
Companies are currently legally allowed to market such deals as ‘green’ (even if the energy they provide customers is generated from fossil fuels) as long as this is offset by purchasing enough Renewable Energy Guarantee of Origin (REGO) certificates to cover their customer base.
The review will consider the extent of greenwashing in the energy retail sector, the transparency of the current system and whether the current requirements for what can legally be marketed as a ‘green tariff’ remain ‘fit for purpose’, the UK government has said.
The systems in place around obtaining REGO certificates will be explored, as well as whether energy suppliers should be required to provide more substantial information about their green tariffs to households, such as clearly stating the type of renewable energy the renewable power was generated from.
Minister of State for Energy and Clean Growth, Anne-Marie Trevelyan has said “I want people to know that when they sign up to a green tariff, they are investing in companies that make a conscious choice to invest in renewable energy… Part of that is ensuring companies are being as transparent as possible on where their power comes from. That way, every family in Britain can rest assured their choices are helping to contribute to our world-leading target of eliminating our contribution to climate change by 2050.”
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