UK’s energy suppliers accused of misleading consumers with false green energy deals

UK’s energy suppliers accused of misleading consumers with false green energy deals

As the United Kingdom market embraces renewable energy on a large scale, energy suppliers have switched to green tariffs to prove to the eager customers that their energy is green. Households contribute about 40 % of carbon emissions in the UK. As homeowners join the government’s ambition to cut emissions, green energy has gained popularity. However, critics have voiced their concerns over false green tariffs, which mislead consumers into believing they are selling renewable energy.

“For years now, energy suppliers have been able to mislead customers who are trying to do the right thing in choosing green. The UK cannot achieve net-zero without bringing everyone along, and being honest with the very people trying to help is not the way to go about that,” said Juliet Davenport, founder of Good Energy. An energy supplier can prove their energy is renewable in three ways. Firstly, they could develop their renewable energy farms where their customers invest their money. The clients can then be 100% sure their energy is sourced from the installed projects.

Secondly, the energy seller can obtain clean power from renewable energy producers through power purchase agreements (PPAs). The procured electricity will be a hundred percent green since the PPA provisions dictate so. The third and controversial way is obtaining renewable energy certificates as evidence that the energy supplied is green. These certificates, renewable energy guarantees of origin (REGOs), claim that 100% of energy sold by a supplier’s energy is green. For each megawatt (MW) of electricity sold to a consumer, a regos certificate is produced.

Major energy dealers in the UK commonly use the regos approach, including Ovo Energy, British Gas, and Bulb energy. However, only a small amount of their total electricity is purchased directly from renewable energy farms, creating false impressions to consumers. For instance, an energy dealer can agree with a renewable energy producer to supply their electricity and receive certificates. Later, the dealer could resell the certificates with different electricity not necessarily sourced from the green power producers. These green tariffs end up confusing households.

The Uswitch site has come to the rescue of consumers by creating a comparison standard to set apart companies based on how they obtain their green energy. The suppliers are graded into gold, silver, and bronze, with gold being those companies with their renewable energy projects. Consumers can never go wrong with the gold deal since it is guaranteed to be 100 % clean. Good energy forms the basis of the grading. The company buys energy directly from one thousand and six hundred green energy producers across the UK, coupled with its own photovoltaic and wind farms. The government is coming up with regulations to safeguard consumers from false green energy tariffs by making firms prove the authenticity of their renewable energy.