Green or renewable energy is derived from natural resources. These are abundant and continuously replenished, making them renewable energy sources. Renewable energy emits little to no greenhouse gases or pollutants when compared to the burning of fossil fuels such as gas and oil. Typical renewable energy sources in the UK include wind, sun, water, waste, and heat.
Green energy tariffs are electricity tariffs ‘backed’ by renewable power. This, however, does not mean that the energy used in your kettle or toaster has come from a wind or solar source.
All energy in the UK comes from the national grid – a mixing pot for all energy sources, including fossil fuel and nuclear, alongside renewable. Today, over half (52.4%) of Britain’s electricity is generated by wind, solar or hydro! Therefore, regardless of which tariff you’re on, at least some renewable energy is part of the mix.
Check out The National Grid Live to see the live National Grid mix in the UK, highlighting the fossil fuel to renewables split.
Green tariffs are energy contracts where your energy supplier has committed to sourcing and purchasing electricity from renewable energy sources, thus supporting the generation of renewable energy, and helping reduce carbon emissions associated with traditional, non-renewable energy sources. When switching to a green tariff, you pay to invest in green energy and help reduce the carbon intensity of the electricity grid and gas supplies, helping drive the decarbonisation and Net Zero journey forward.
Some energy suppliers sell ‘Renewable Tariffs’. This means they have purchased Renewable Energy Guarantees of Origin (REGOs) or Renewable Obligation Certificates (ROCs). These certificates are used to evidence that energy purchased by your supplier is from a renewable energy supply. Alternatively, they may invest in renewables, by building things such as solar farms and wind turbines themselves, or having contracts directly with renewable suppliers such as Power Purchase Agreements (PPAs). A mixed approach is often the most frequent scenario, generating some renewable power alongside purchasing it from renewable generators. Both kinds of tariff count as ‘green’ or ‘renewable’ under UK law.
Both certificates are run and issued by Ofgem: ROCs are a form of subsidy featuring higher or lower ROC banding depending on the energy generation technology type and how old it is, whereas REGOs
are assigned to every unit of renewable energy. Dark green REGOs, which are those from hydro, wind and solar assets are typically more valuable than those from Anaerobic Digesters, Biomass and Landfill gas.