Types of Tariffs: Green / Renewable Energy
Are you looking for an energy supplier that will contribute to sustainable development by promoting green and renewable energy? This article explains what green energy tariffs are all about.
Why choose a Green Energy Tariff?
- Green energy tariffs are plans for customers who want to promote the use of renewable energy
- Renewable energy tariffs are getting cheaper
- There are a wide range of renewable suppliers offering green energy tariffs
What are Green Energy Tariffs?
Green energy tariffs refer to the fuel mix energy suppliers use for electricity. It does not refer to gas since natural gas is already considered “green” - but not renewable - energy. Energy suppliers all disclose their fuel mix so customers can see how much of it is carbon, natural gas, nuclear, renewable, etc.
Green Energy Tariff Options
Unlike variable or fixed energy tariffs, green energy tariffs can apply to a wide range of situations:
- Can apply to credit or prepaid meters
- Can be combined with variable or fixed energy tariffs
- Can be linked to an online or offline energy plan
How green is a "Green Energy" Tariff?
Energy suppliers include a greater or lesser share of green and renewable energy in their green energy tariffs. The same supplier might offer one “green” energy tariff with a 15% share of renewable energy and another green energy tariff with a 100% share of renewable energy.
Therefore, the green energy tariff customers choose also depends on “how green” they want their electricity to be. On this note, only Good Energy is “green energy certified” by the Green Energy Certification Scheme, which checks how far beyond current regulations a supplier is going to meet renewable energy targets.
Are Green Energy Tariffs More Expensive?
A Department of Energy and Climate Change report states that the average bill on a green energy tariff is higher than average bills on other tariffs. However, some suppliers, such as Ovo Energy or LOCO2 Energy, are changing that trend by offering green energy tariffs that compare well to non-green energy tariffs.
For example, when using a London-based comparison of the average UK energy consumption (3,200 kWh per year for electricity and 13,500 kWh for natural gas) applied to June 2014, an energy supplier comparison yields estimated annual costs ranging from £1,018 (Ovo Energy) to £1,156 (Good Energy) for dual-fuel and from £440 (Ovo Energy, 15% renewable) to £524 (also Ovo Energy, 100% renewable) for electricity only.
Which Suppliers Offer Green Energy Tariffs?
In 2021, there are a growing number of renewable energy suppliers offering green energy tariffs. See our provider list for some of them.
Is the Energy from Green Tariffs Truly Renewable?
Unfortunately, except for customers with solar panels, the electricity supplied from all suppliers - green or not - comes from the same big melting pot of energy, known as the National Grid. Therefore it's impossible to guarantee that every unit of energy you use has come from a renewable source, even if you are on a "100% renewable" tariff.
However, by buying electricity generated from renewable or green sources, suppliers are not only promoting green energy but also increasing the share of green energy in the national fuel mix.