Should businesses be concerned about the credibility of their renewable electricity?
As a founding partner of the edie Sustainability Leaders Club, I have often been asked why we aren't seeing more companies choosing to buy renewable electricity. I believe a lack of confidence is constraining take-up. By knowing what to look out for, you can avoid the pitfalls...
Since the removal of Levy Exemptions Certificates last summer, renewable generation has been evidenced by Renewable Energy Guarantee of Origin (REGO) certificates.
Customers buying renewable electricity therefore assume that it is backed by a REGO through their supplier. But with millions of megawatt hours and millions of certificates out there, this is an almighty task!
The key thing is for suppliers to be transparent and I believe the following is the minimum you should expect:
1. Is every megawatt backed with an origin certificate?
Under-allocating of origin certificates is a concern of many in the industry. If businesses use hundreds of thousands of megawatts in a year, every single one of those needs to be matched to a REGO in order to be reported as renewable supply. It’s not enough for suppliers to just estimate or roughly make sure they have enough certificates in their portfolio.
2. Are those individual origin certificates only being used once?
Another concern for businesses is whether their supplier can guarantee that any origin certificate allocated to their supply has not also been allocated to someone else. Again, this comes down to the robustness of the suppliers’ tracking and allocation process, so businesses should ensure their origin certificates are exclusively theirs to use for reporting.
3. Can your supplier verify the generation source of your supply?
Origin certificates are ultimately just a string of numbers recorded on a register by Ofgem, then allocated to a suppliers’ renewable supply. But for some businesses, the generation technology or project size or location may be important - so suppliers should be able to provide a breakdown of the renewable fuel mix for their customers.
4. Will your supplier make this information available to you?
All suppliers in the UK have a different approach to supplying renewables, although lack of transparency is common across many of them. Many businesses just assume that their supplier is doing the right thing with backing their renewable supply - and they probably are - but ideally they should proactively share the details with their customers and be open about the credentials of their renewable supply.
Buying renewable electricity should be an integral part of every sustainable organisation’s energy strategy but it’s not there yet - just a few weeks ago, Carbon Clear reported that only 50% of the FTSE100 buy renewable.
Only through suppliers improving transparency and credibility, giving customers real confidence in the provenance of their supply, can we increase the business uptake of renewables and ensure our low-carbon future.Mike Shirley