Energy firms accused of ‘greenwashing’ renewable energy tariffs

The consumer organisation Which? Says many energy companies “risk misleading their customers” about renewable electricity. The warning comes as many charity facilities managers seek to switch to energy from renewable energy suppliers.

An off-shore windfarm (Photo: Andreas Klinke Johannsen, CC BY-SA 2.0, via Flickr)

By Annette McGill

Energy suppliers are increasingly offering to supply 'green' energy - but an investigation by Which? has found some companies are advertising 100 per cent renewable energy while not generating or buying any renewable energy from suppliers.

Instead, they are just buying certificates that permit them claim that their electricity is 100 percent renewable.

The energy regulator Ofgem supplies companies that generate renewable electricity with a Renewable Energy Guarantee of Origin (REGO) certificate for every megawatt hour of wind or solar electricity they generate. Energy suppliers that buy renewable electricity direct from a generator can buy the accompanying REGOs.

But there is also a secondary market for REGOs where they can be traded for as little as 15p per certificate.

Which? checked more than 350 energy tariffs and found 40 companies that were offering 100 per cent renewable electricity. Some of these companies were not by or generating any renewable energy. 

Which?’s analysis also found suppliers whose parent company generates some renewable electricity or which buys some renewable energy from generators - but not enough to match 100 per cent of what they sell. They reach 100 per cent renewable by topping up with REGOs.

Need for clarity

Charity facilities managers - or those responsible for purchasing energy - should understand their energy bills and know what tariffs they pay. 

Richard Headland, Which? Editor-in-chief, said:

“We believe there needs to be greater clarity on how renewable electricity is defined and marketed. People can only make informed decisions about where to buy their energy from if firms are more upfront and transparent about their green credentials.”

Businesses are responsible for more than half of the UK’s energy consumption. The research focused on household supplies. In many cases, a green premium is added to renewable tariffs. Npower charges an green premium of £70 per year.  

In 2018 one third of the UK’s electricity came from renewable sources. Business and local governments are increasingly switching to renewable supplies. Last month East Sussex County Council announced that all street lights and council buildings in East Sussex will be powered by 100 per cent renewable electricity from 2020.