Reality Or Rhetoric? Green Tariffs for Domestic Consumers

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Reality Or Rhetoric? Green Tariffs for Domestic Consumers reality or rhetoric? green tariffs for domestic consumers Äó=sáêÖáåá~=dê~Ü~ã pìãã~êó N ^Äçìí=íÜÉ=~ìíÜçê ^ÅâåçïäÉÇÖÉãÉåíë NK=fåíêçÇìÅíáçå O sáêÖáåá~=dê~Ü~ã=áë=~å=ÉñéÉêí=áå=ëìëí~áå~ÄäÉ qÜáë=k~íáçå~ä=`çåëìãÉê=`çìåÅáä=Ek``F OK=tÜ~í=áë=ÖêÉÉå=ÉäÉÅíêáÅáíó\ P ÉåÉêÖó=~åÇ=ÅçåëìãÉê=éêçíÉÅíáçå=éçäáÅóK êÉéçêí=ï~ë=ïêáííÉå=Äó=sáêÖáåá~=dê~Ü~ãI cçê=íÜÉ=é~ëí=ëáñ=óÉ~êë=ëÜÉ=ï~ë=aáêÉÅíçê=çÑ ïáíÜ=êÉëÉ~êÅÜ=ëìééçêí=Ñêçã=`~ëë~åÇê~ PK=oÉÖìä~íçêó=ÉåîáêçåãÉåí Q båîáêçåãÉåí~ä=^ÑÑ~áêë=~í=íÜÉ=ÉåÉêÖó eáÖÖëI=Ä~ëÉÇ=çå=~=Çê~Ñí=Äó= QK=dêÉÉå=í~êáÑÑë=çå=çÑÑÉê T êÉÖìä~íçêI=lÑÖÉãK=mêÉîáçìëäó=ëÜÉ=ïçêâÉÇ g~ÅèìÉäáåÉ=aáñçåK Ñçê=ÑáÑíÉÉå=óÉ~êë=çå=ÉåîáêçåãÉåí~äI=ëçÅá~ä qÜÉ=k``=ïçìäÇ=äáâÉ=íç=íÜ~åâ=íÜÉ Ó=ÖêÉÉå=í~êáÑÑë=Äó=íóéÉX=éêÉãáìãë=Ñçê=ÖêÉÉå=í~êáÑÑë= NM ~åÇ=ÅçåëìãÉê=éçäáÅó=~í=ÄçíÜ=íÜÉ=br=~åÇ ÑçääçïáåÖ=Ñçê=ÅçåíêáÄìíáåÖ=íÜÉáê=íáãÉ= rh=äÉîÉäëK Ó=Öì~ê~åíÉÉë=çÑÑÉêÉÇ=Äó=É~ÅÜ=ëìééäáÉê=íç=Ä~Åâ=ìé=íÜÉáê=ÖêÉÉå=í~êáÑÑ NN ~åÇ=éÉêëéÉÅíáîÉë=íç=íÜÉ=éêçàÉÅí=ëÅçéáåÖI Ó=ÖêÉÉå=í~êáÑÑë=Äó=ëìééäáÉê NO êÉëÉ~êÅÜ=ÇÉîÉäçéãÉåí=~åÇ=êÉîáÉïW RK `çåÅäìëáçåë=~åÇ=êÉÅçããÉåÇ~íáçåë OO lìê=ïçêâ=çå=ëìëí~áå~ÄäÉ=ÉåÉêÖó pìë~åå~=j~ó=~åÇ=h~íÉ=pãáíÜI=aÉé~êíãÉåí Ñçê=båîáêçåãÉåíI=cççÇ=~åÇ=oìê~ä=^ÑÑ~áêë ^ééÉåÇáñW ëçìêÅÉë=çÑ=áåÑçêã~íáçå=~Äçìí=ÖêÉÉå=í~êáÑÑë OR låÉ=çÑ=íÜÉ=k``Ûë=ëíê~íÉÖáÅ=çÄàÉÅíáîÉë=áë= EaÉÑê~FI=hêáëíá~å=^êãëíêçåÖI=aÉé~êíãÉåí íç=éêçãçíÉ=~åÇ=~ÅÜáÉîÉ=ãçêÉ=ëìëí~áå~ÄäÉ çÑ=qê~ÇÉ=~åÇ=fåÇìëíêó=EaqfFI=a~å kçíÉë=~åÇ=êÉÑÉêÉåÅÉë= OT ÅçåëìãéíáçåK=få=íÜáë=ÅçåíÉñí=íÜÉ=k``=áë pí~åá~ëòÉâI=båÉêÖó=p~îáåÖ=qêìëíI=dáääá~å líÜÉê=éìÄäáÅ~íáçåë OU ïçêâáåÖ=çå=ëìëí~áå~ÄäÉ=ÉåÉêÖóK=qÜÉ=ã~áå `ççéÉê=~åÇ=bÇ=oÉÉÇI=ÉåÉêÖóï~íÅÜI=gçÜå ~áã=çÑ=íÜÉ=éêçàÉÅí=áë=íç=éêçãçíÉ=éçäáÅáÉë `çëíóå=~åÇ=`~íÜ=j~êíáåÇ~äÉI=lÑÑáÅÉ=çÑ=d~ë ~åÇ=éê~ÅíáÅÉë=íÜ~í=ã~âÉ=ëìëí~áå~ÄäÉ ~åÇ=bäÉÅíêáÅáíó=j~êâÉíë=ElÑÖÉãFI=`Üêáë ÉåÉêÖó=ÅÜçáÅÉë=É~ëáÉê=Ñçê=ÅçåëìãÉêëK= g~êÇáåÉI=båîáêçåãÉåí~ä=`Ü~åÖÉ=råáí=~í=íÜÉ qÜáë=êÉéçêí=çå=ÖêÉÉå=í~êáÑÑë=áë=íÜÉ=Ñáêëí råáîÉêëáíó=çÑ=lñÑçêÇI=~åÇ=çíÜÉêëI=áåÅäìÇáåÖ éìÄäáÅ~íáçå=ìåÇÉê=íÜÉ=ëìëí~áå~ÄäÉ=ÉåÉêÖó ÅçääÉ~ÖìÉë=~í=íÜÉ=k``K éêçàÉÅíK=^=ëÉé~ê~íÉ=k``=éêçàÉÅí=~áãë=íç qÜÉ=k``=ïçìäÇ=~äëç=äáâÉ=íç=íÜ~åâ=íÜÉ éêçãçíÉ=íÜÉ=~î~áä~Äáäáíó=çÑ=~å=~ÑÑçêÇ~ÄäÉ ÉåÉêÖó=ëìééäó=Åçãé~åáÉë=Ñçê=éêçîáÇáåÖ=íÜÉ ~åÇ=ëìëí~áå~ÄäÉ=ÉåÉêÖó=ëìééäóK ÇÉí~áäë=çå=íÜÉáê=ÖêÉÉå=í~êáÑÑëK== Summary In 2004, the average household This report explores the options In most cases, tariffs with hÉó=êÉÅçããÉåÇ~íáçåë emitted around six tonnes of carbon for consumers who want a green premiums deliver greater All energy suppliers should: dioxide (CO2): 1.7 tonnes from tariff. In it, we look at the green environmental benefits than electricity and 4.3 tonnes from gas. tariffs on offer and assess whether those without. sign up to a Consumer Code Electricity from renewable sources they meet their suppliers’ based on Ofgem’s revised Green There is too little clear and is vital in reducing the CO put into environmental claims. Supply Guidelines; undertake 2 accurate information available on the atmosphere, by both households to provide full and accurate most green tariffs, and it is difficult and other users. Domestic consumers information about the tariffs they for consumers to compare, as it is hÉó=ÑáåÇáåÖë= offer; and not make claims that can reduce their CO2 emissions by not in a standard format. cannot be substantiated. signing up to a green tariff, but Many green tariffs are not Given the complex legislative and according to the research informing delivering the environmental have their tariffs independently regulatory framework surrounding this report, less than one per cent of benefits they claim to.As a result, audited against a benchmark, and green electricity, it is easy for households in Great Britain – some consumers may not be making the to inform consumers of their consumers to be misled by 200,000 – have done so. positive contribution they think household’s likely CO reductions suppliers’ claims. 2 A recent poll suggests that there is they are. if they switch to a green tariff. Suppliers are not making it considerable interest: 64 per cent Many suppliers are doing clear to consumers that their of respondents said they would little more than meeting legal For a full list of conclusions and electricity bills are already consider switching to a green energy requirements.There is scope recommendations, see section five. supporting increased renewable company. But to fulfill this potential, in the system to count the electricity – by around £7 per consumers must have clear, ‘greenness’ of electricity more household (in 2005/6). unambiguous information about than once. what is on offer, and confidence that Even the better tariffs on offer green tariffs will deliver what they These findings are worrying.There will only reduce CO emissions promise. Only then will consumer 2 is a danger that consumers will be by around 100 kg a year – just six confidence levels rise to a point alienated from the behaviour change per cent of an average household’s where the market for greener energy agenda.This, in turn, could threaten CO emissions. can succeed. 2 the succes of the government’s sustainability strategy. 1 1 Introduction The domestic sector is responsible of not reducing global warming to With the Sustainable Development for just under a third of total UK safe limits and underlined the Commission, NCC was a partner CO2 emissions. Each year, the importance of decarbonising the in the Sustainable Consumption average household emits around six energy supply4.The Review has Roundtable. Its final report in tonnes of CO2, the equivalent of provided a new context, not only May 2006, I will if you will, made filling 34 double decker buses1. If the for the UK’s energy policy, but also a range of recommendations to government is to meet its target to for the global response to climate government, regulators, business cut CO2 emissions by 20 per cent change.Taking account of all of and other stakeholders. by 2010 over 1990 levels, households these, the government announced in According to the report, switching must reduce the energy they use, and the Queen’s Speech in November, to a green tariff should be one of there has to be a reduction in the that it will bring forward a Climate the simplest ways for households to amount of CO emitted by the Change Bill in 2007. 2 reduce their environmental impact6. electricity generation process. The UK Sustainable Development However, according to NCC’s This message has been underlined Strategy highlights sustainable research, only some 200,000 several times this year in a series of consumption and climate change as households in Great Britain, or less high-level government reviews and two of the key priorities for a more than one per cent of the total, have reports.The Energy Review Report sustainable future. In the strategy, the already chosen to sign up to such a stressed the importance of meeting government sets out a commitment tariff. In a poll carried out for the the climate change challenge and set to focus on measures that will enable Observer in October 20067, 64 per out a policy context for doing this2. and encourage behaviour change and cent of those questioned said they It will be followed up by a white build on people’s growing awareness would consider switching to a green paper in March 2007.The Climate of environmental concerns5. company for their gas and Change Programme outlined the electricity, which suggests that there individual measures and instruments is considerable unfulfilled potential. that will deliver the government’s 3 CO2 target .The Stern Review estimated for the first time the costs 2 2 What is green electricity? cáÖìêÉ=çåÉW=íÜÉ=éêáåÅáé~ä=ëçìêÅÉë= çÑ=íÜÉ=rh=ÉäÉÅíêáÅáíó=ëìééäóI=OMMR aqfI=OMMS láä d~ë 1% 37% Green electricity is generated from in the middle of the last century and to contain high amounts of biomass, renewable sources using natural so do not constitute new renewable it will generally be included in the oÉåÉï~ÄäÉë energy flows of the earth that will capacity. Nonetheless, electricity definition of renewable sources. 5% never be depleted.This is opposed generated from large-scale hydro Figure two sets out the different `ç~ä to ‘brown’ electricity, which is does not result in the emission of sources of accredited renewable 34% kìÅäÉ~ê 20% generated from fossil fuels (such as CO2. Small-scale new and electricity output in 2004/5. coal, oil and natural gas) and from refurbished hydro plants are Landfill gas accounted for one-third nuclear fission. considered to be ‘dark green’. of the total, with on-shore wind accounting for just one-sixth. Figure one sets out the fuel sources Electricity generated from biomass of the UK’s electricity supply, with does involve some form of burning, Due to the complex physical nature renewable sources making up less or ‘combustion’. However, the of electricity it is not possible for than five per cent in 2005.Although emissions from this are considered suppliers to guarantee that a unit of cáÖìêÉ=íïçW=~ÅÅêÉÇáíÉÇ=êÉåÉï~ÄäÉ every electricity generation source to be offset by the CO2 that the renewable electricity they buy from ÉäÉÅíêáÅáíó=ÖÉåÉê~íáçå=Äó=íÉÅÜåçäçÖóI= OMMQLMR will have some form of biomass absorbed during its lifetime. a generating plant actually reaches lÑÖÉãI=oÉåÉï~ÄäÉë=lÄäáÖ~íáçå=oÉîáÉïI=OMMS environmental impact, renewable Therefore it is considered to be the customer’s home.All a supplier sources do not cause CO2 to be carbon neutral and so ‘dark green’.
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