Sunday, 21 April 2013

Green electricity offerings

Most energy suppliers offer 'green' electricity tariffs. These seek to support renewable energy. The two main types of offering are green supply tariffs and green funds.

Green supply tariffs
A green supply tariff means that some or all of the electricity you buy is 'matched' by purchases of renewable energy that your energy supplier makes on your behalf. These could come from a variety of renewable energy sources such as wind farms and hydroelectric power stations. Your supplier should let you know what sources are included in the mixture, and also what proportion of your supply is renewable.

Many green tariffs state that your supply is renewable but they simply assign some of the renewable energy they are already required to supply to you, while reducing the amount of renewable energy they provide to other customers. This does not increase the amount of renewables in the overall energy mix.

Some companies will guarantee that a proportion of the renewable energy they are purchasing (and you are buying) is 'additional' - it is above and beyond what suppliers are already required to produce. This creates an additional incentive to develop new generation capacity and so could lead to increased renewable generation and reduced carbon dioxide emissions.
There are no companies offering green tariffs that are 100% additional renewable supply.

Green funds
A green fund usually involves paying a premium to contribute to a fund that will be used to support new renewable energy developments. Under this option, the existing electricity supply continues as normal, but your involvement could help to alter the mixture of energy sources in future toward renewable sources (depending on the type of tariff).

The new generation projects supported may also receive support under existing government support schemes.

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