Are all green energy tariffs as green as they seem?

The energy market is teeming with tariffs labelled as ‘green’ or ‘renewable,’ but what lies beneath these claims? According to the Ethical Consumer, many suppliers buy Renewable Energy Guarantee of Origin Certificates (REGOs) to market fossil fuel-derived energy as ‘green electricity.’ These certificates can be traded on a secondary market, allowing suppliers to claim their energy is green without sourcing it directly from renewable resources.

Ethical Consumer highlights Good EnergyEcotricity and GEUK as ‘best buys.’ These are the only tariffs that can be genuinely considered 100% renewable. For those seeking tailored advice, a specialist broker like Squeaky can guide you through the process, ensuring environmental considerations are at the forefront of your decision.

If you are a business with substantial energy needs, e.g. from manufacturing processes or large-scale data processing, you may be able to benefit from a Power Purchase Agreement. Such agreements involving sourcing renewable energy directly and can provide a stable, greener and often more affordable source of electricity over the long term. Again, specialists such as Squeaky are a good place to start in exploring such possibilities.

Tenant Rights and Green Energy

Directly Paying Tenants

If you are a commercial tenant directly paying for the electricity bill, you are legally entitled to change your energy supplier. Ofgem’s advice on how to switch suppliers as a tenant says that a “default supplier clause” in your tenancy agreement allows your letting agent or your landlord to have the final decision on hiring a preferred energy supplier regardless of your preference. However, under this situation, you can still legally request the change. 

Tenants Not Directly Paying for Electricity

For those not directly paying for electricity, the situation is more complex. The decision to change suppliers lies with the landlord. However, you can explore modifying your tenancy agreement to become the bill payer or persuade your landlord about the benefits of switching suppliers. If you are a commercial tenant in a shared building, consider joining forces with the other tenants to put pressure on your landlord to change.

Distinguishing truly green tariffs from those masquerading as sustainable is crucial in making ethical and environmentally conscious choices. Whether you’re selecting a tariff for your home or navigating the complexities of tenant rights, understanding the intricacies of the green energy market empowers you to make informed decisions. To explore the issues involved here in more detail, see this excellent guide from Ethical Consumer Guide to Gas and Electricity Tariffs or this Insight piece from Squeaky.

A digital illustration showing a person standing at a fork in a path, contemplating two distinct landscapes. On the left, a green and lush environment symbolizes renewable energy, complete with a sun and leaf icon floating above. On the right, a dark, industrial landscape represents fossil fuels, with a smokestack and oil barrel icon.