Green tariffs lack transparency. Switch anyway.
Switching to green electricity is a complex decision. You probably get all of your power from the national grid, which makes your electricity exactly the same as everyone else’s. So how can your electricity be greener?
There are two types of company involved: suppliers and generators. Generators own the power stations, wind farms and other plant that provide electricity to the grid. Suppliers manage retail relationships and must either purchase wholesale electricity from a generator or operate their own generators. In fact, to manage capacity, all suppliers trade in electricity to some extent.
The mix of generation sources determines the quantity of emissions and hence it is the generators that we are trying to change; suppliers are our levers. Pretty much every supplier now offers a green tariff. They work differently and some are more effective levers than others. Three key questions to ask of green tariffs are:
- Does the supplier also cater for non-green tariff customers and ‘allocate’ its renewably generated electricity to a limited number of green tariffs? This is common practice. Some companies – including Npower – are able to provide their green tariff customers with 100% green electricity within their Renewables Obligation (a government requirement to purchase or generate a proportion – 7.9% in 2007/08 – of electricity from renewable sources). The effect of this practice is that switching simply reduces the proportion of renewable energy ‘allocated’ to non-green tariffs and has little or no effect on the overall fuel mix.
- Are carbon offsets used as part of the package? If so, you will have the added complexity of assessing the quality of the offsets before you understand the tariff. If you sign up to British Gas’s new ‘Zero Carbon’ tariff, for example, British Gas will purchase 20% of the electricity you use from renewable sources (12% of which is guaranteed not to go toward their Renewable Obligation). Emissions associated with the other 80% are offset.
- What proportion of the electricity is green? Most green tariffs now claim 100% of electricity is green, but some are under 20%.
If you can afford the premium, opt for a top-end tariff from Good Energy. You can be sure you will be funding new generators. Otherwise, switch to your supplier’s green offering anyway – according to Friends of the Earth less than 1% of households are on a green tariff. Only sheer volume will push the big suppliers beyond their Renewables Obligation.