Only tariffs approved by the Ofgem will be able to be labelled as green
Government regulator redefines 'green electricity'
9th February, 2010
Ofgem's attempts to help consumers identify which electricity suppliers are really 'green' might lead to confusion, says energy watchdog
Only electricity suppliers who can demonstrate that their tariffs result in a reduction in carbon emissions will be able to claim that they supply 'green electricity', under new rules from the UK energy regulator Ofgem.
A green electricity tariff must mean the supplier has gone beyond existing Government requirements for sourcing renewable electricity that all suppliers, regardless of what tariffs they offer to consumers, have to meet.
But going 'the extra mile' could mean investing in community-based renewables or carbon offsetting - a decision the Energy Saving Trust (EST) said could be confusing for customers.
'Carbon offsetting or "additional activities" might mislead people who believe green tariffs will reduce their carbon footprint, when it may simply be passing on carbon elsewhere, such as offsetting activities overseas,' said Marian Spain from the EST.
Ofgem's new rules will be implemented by an independent panel, the green energy scheme. Headed up by Solitaire Townsend, co-founder of green marketing agency Futerra, the panel will decide which tariffs can be certified as 'green energy'.
Townsend said the aim of the scheme was to encourage more consumers to buy green energy.
'Only two per cent of Britons currently buy green energy, but I hope that a trustworthy label will convince many more to go green. The panel decisions will be based on evidence not marketing,' she said.
A number of suppliers, including E.On, EDF Energy, and Good Energy have backed the scheme and put forward tariffs to be certified.
A premium product
However Ecotricity, which invests profits from tariffs into building new renewable sources of electricity, says the rules will mean they won't be classified as 'green' despite having built 51 wind turbines across the UK, generating 52MW of electricity.
Dale Vince, Ecotricity founder, said the rules would simply create 'a premium product that doesn't invest a penny more in large-scale green energy, and doesn't make Britain any greener'.
'Consumers just want to be sure of two things: where is my green energy coming from, and what good will my bill bring? And both of these are quick and simple to verify.'
Vince said suppliers like EDF Energy and E.On were more interested in short-term profits for shareholders than investing in Britain’s long-term future.
EST urged those interested in signing up for a green electricity supply to check the details of their chosen tariff and ensure it 'lives up to their personal definition of green'.
Green Energy Scheme
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