How environmentally friendly are green energy tariffs?

Ofgem calls for energy suppliers to be more transparent regarding the environmental benefits of their ‘green’ energy plans

Suppliers will need to justify the higher prices paid by customers on green plans

Suppliers will need to justify the higher prices paid by customers on green plans

Energy regulator Ofgem has found that many energy plans advertised as ‘green’, make environmentally-friendly claims which are not certified.

As a result, Ofgem is demanding that power companies demonstrate plans’ green credentials to their customers.

This is particularly important as green plans often cost more than standard plans and firms claim the extra cost is reinvested in initiatives aimed at providing more renewable energy.

‘Changes will give consumers confidence to make more informed decisions’

Ofgem has proposed three main criteria for all future tariffs choosing to label themselves as green.

The first is a degree of transparency, highlighting any environmental benefits resulting from customers selecting that plan and not another.

Suppliers will also be required to publish a yearly report which must show that any benefit is a result of the green plan itself and not separate government imposed subsidies or obligations.

Finally, providers must provide evidence to verify where electricity supplied as part of a green plan comes from.

Senior Partner for Sustainable Development at Ofgem, Sarah Harrison, said: “We believe these changes will give consumers confidence to make more informed decisions about buying tariffs based on renewable energy.”

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