Green Energy is generated by renewable, natural energy sources like solar, wind, geothermal, hydro, wave and tidal power. These sources are naturally replenished and have a much smaller impact on the environment than using fossil fuels, such as coal and oil, which take thousands of years to form, are finite in supply and create pollution, both to extract and use.
Green energy tariffs are no longer an expensive option. A study of the energy market by Flipper reveals that:
The cheapest green energy tariffs are some of the cheapest deals on the market, with some deals costing as little as £940/yr.
However, many customers still believe green tariffs are more expensive and the growth of cheaper green tariffs has also raised concerns over just how green they are. Flipper investigates.
According to Ofgem, there were 69 active gas and electricity suppliers in September 2018.
And the total number of gas and electricity tariffs in the energy market right now is 2472*. Of the 2472 tariffs available, 573 (23%) are green tariffs and 1898 (77%) are non-green tariffs. That's quite a lot of options if you're after a green tariff.
The UK Government has pledged that at least 30% of our electricity must come from renewable sources by 2020. Considering the lack of green energy suppliers (23%), the government’s 2020 target looks out of reach. Sweden was reaching 40% renewable energy share back in 2004 already! Currently the UK is sitting in the bottom 5 amongst our European friends.
To offer a 100% renewable energy tariff, energy suppliers must either supply to the grid at least as much renewable electricity as their customers consume Or they must purchase a REGO (Renewable Energy Guarantees of Origin) certificate.
The purpose of the REGO certificate is to prove that energy was produced from renewable sources. REGO certificates are part of the fuel mix disclosure (FMD). The FMD requires licensed electricity suppliers to disclose to their customers the mix of fuels (coal, gas, nuclear, renewable and other) used to generate the electricity supplied.
REGO certificates are sold by renewable energy generators who have supplied electricity to the National Grid rather than to individual suppliers.
Note: You don't need to clarify the origins of gas in order to be deemed as a green supplier. Only electricity is considered at this point.
Biogas (also known as 'green gas') is produced from environmentally friendly sources (manure and food waste). Once processed, it's upgraded to bio-methane which has the same quality as conventional gas. This bio-methane is then introduced into the distribution network and is ready for use.
“Emissions associated with the biomethane can be up to 97% lower than those for compressed natural gas.”
Organisations like South Pole provide green gas certificates that guarantee the gas you consume comes from 100% sustainable sources. Energy provider Bulb claims 10% of their gas comes from carbon-neutral renewable sources (100 times higher than the national average of 0.1%.)
Green Energy, another renewable energy supplier who also claim to be 100% green for both gas and electricity and to use biogas explained in the short clip below:
They are the same thing. Renewable energy comes from sources like solar, wind, geothermal, hydropower, wave and tidal power are forms of renewable energy.
Energy tariffs described as Green energy indicated the supplier is using energy generated from renewable sources.
According to REGO, energy tariffs must use 100% renewable energy to be labelled as a ‘green tariff’.
However, we discovered that: energy suppliers are labelled as ‘green’ if they have a green tariff that you can switch to. For example, OVO energy (who market themselves as a ‘green' energy provider) have a standard tariff which is only 33% renewable. Customers must upgrade to a green tariff if they want to use 100% renewable sourced energy.
Nuclear power uses uranium which is not renewable, and because of this, it is not considered ‘green’ energy. From our study, energy suppliers claiming to be ‘green’ do not have nuclear power in their fuel mix.
The good news is that the energy industry is shifting from fossil fuel dominated energy generation mix to renewable generation (from solar and wind). Since 2015, the share of electricity generated from bio energy, wind and solar increased, while the percentage made from coal decreased significantly.
At the time of writing (Jan 2019), the average price for a green tariff is £1,109.12. Cheaper than the average price for non-green tariff (£1,136.17) by more than £30.
The cheapest green tariff—which is the cheapest of any tariffs on the market (from People's Energy) - is £940.44. The second cheapest green tariff is by So Energy priced at £969 (£2.41 per month more). So Energy was voted best customer service provider by Citizens Advice).
Our study found that the cheapest non green tariff is £1,386.56, supplied by First Utility. This tariff by First Utility uses 0% renewable energy.
At the date of this article - it belongs to People’s Energy (priced between £940.44 and £957 depending on your postcode). Some of the most expensive tariffs on the are supplied by Green Energy, who claim to the first UK supplier to provide both 100% green gas as well as electric. So perhaps the price some people will be willing to pay from a truly ethical stand point.
It’s our view that as the industry shifts to renewable energy like biogas, wind, solar and tidal, energy tariffs will organically become ‘greener’. Solar has been breaking records already in 2019 contributing as much as 36% of the electricity used in the UK, which is great, but whether we are on track to meet the government’s target by 2020, we’re not yet convinced.
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* Data collated using Runpath (A whole of market data source for energy tariffs) as of January 2019.
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