United Kingdom

United Kingdom

Strict Ofgem guidelines over green energy products spark row

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British energy regulator Ofgem's new stricter guidelines for "green" energy products sold at a higher price than dirty electricity have sparked a row over what qualifies as green electricity. The aim of the revised rules is to clarify what electricity retailers can market as truly green. Ofgem points out that some retailers simply repackage as "green" their existing generation, including the renewable energy that they are legally required to supply under the Renewables Obligation (RO). The guidelines will form the basis of an accreditation system to be run by an independent body. But green power company Ecotricity refuses to sign up to the guidelines, dubbing them a "greenwash." Green electricity "tariffs," as prices for green electricity products are called, should be about green electricity, says Ecotricity's Dale Vince. "In these guidelines Ofgem are accrediting everything you can imagine except the thing that really counts -- green electricity. Of course we believe in planting trees, protecting wildlife and cutting carbon, all of these things have an important role to play, but not in green tariffs." Consumer choice could play a crucial role in helping the UK meet its renewable targets, says Vince, but he accuses Ofgem of sidelining the consumer by excluding "real green electricity" from its definition of green tariffs. "Ofgem's plan will make green tariffs more expensive whilst at the same time making them achieve less." Welcoming the new rules is GoodEnergy. Its founder and CEO, Juliet Davenport, says the company has been calling for clearer guidelines for years. She adds that some retailers have been taking advantage of the market structure to "double count," or sell the same unit of renewable electricity two to three times due to the certificates awarded for renewable generation: ROCs, levy exemption certificates (LECs) and renewable energy guarantees of origin (REGOs). Under the new rules, the only measure of greenness is the REGO. Retailers have to demonstrate additional benefits beyond their existing obligations and be able to undertake an "environmental activity" which abates a minimum amount of carbon dioxide equivalent emissions. The big six electricity retailers, as well as Good Energy, have signed up to the new rules.

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