Many businesses are now looking to be carbon free. In an ideal world we would all only use energy from renewable energy sources. The first step in making the change from energy sources that emit greenhouse gas emissions to carbon free sources is understanding what options you have available to you.
Navigating the different ‘green’ tariffs and other options can be tricky. We believe that it shouldn’t be stressful to switch over to solely renewable energy sources. In this guide we will provide answers to key questions surrounding the somewhat confusing topic of REGO Schemes and how they can benefit you:
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A Renewable Energy Guarantees Origin (REGO) scheme was created to clearly tell you what percentage of electricity the supplier provides was generated from renewable sources. In the UK, a REGO backed supply is subject to availability and is administered by Ofgem, the energy industry regulator, who act on behalf of the Department for Business Energy and Industrial Strategy (BEIS). The scheme was designed to make a serious difference to businesses across the EU as electricity accounts for at least half of most business’s total carbon emissions.
The regulator Ofgem gives one REGO certificate to a renewable energy provider for every 1000 units, or one megawatt hour (MWh), of renewable energy they generate. This REGO certificate is considered proof that at least some of the energy that is provided to you is from renewable energy sources.
Essentially, when your energy supplier purchases the power from the renewable generator, they will also buy the REGO certificate for approximately 15p each. Then at the end of each year, your energy supplier must submit their REGO certificates back to Ofgem who list it in the Renewable and CHP register which proves how much renewable energy the suppliers actually provided.
The REGO scheme is incredibly important for businesses where sustainability and carbon neutrality are either key to your business’ brand or corporate social responsibility strategy. REGO can largely be considered as proof that your business is making an active effort to source your energy renewably.
However, there is evidence that a lot of ‘green’ energy suppliers are not actually sourcing their energy from renewable sources. How are these companies getting away with it?
Ofgem don’t require an energy supplier to provide direct proof of where their renewable energy comes from. All they require is energy suppliers to count up how many REGO certificates they have accumulated over the year. Unfortunately, there is a huge market for these REGO certificates and companies are taking advantage of it.
Energy suppliers can buy their power from anywhere. This includes coal-fired power stations, or any non-renewable or fossil fuel source that is terrible for the environment. All they then have to do is buy enough REGO certificates to match.
This manipulation of the REGO scheme is known as ‘green-washing’ and has become a serious problem with more and more suppliers claiming to offer ‘100% renewable’ tariffs, despite holding little or no contracts with renewable generators.
First of all you, need to be careful not to be tricked by these green-wash tariffs. Because if you are a company that places a high emphasis on environmental sustainability, being deceived by a green-wash tariff means you will still be using non-renewable energy sources which could affect your credibility.
The most important thing you can do when looking for your ideal REGO Scheme is to remember that if it seems a bit too good to be true, then it just well might be. If you find a tariff that promises to be 100% renewable and is also dirt cheap, before you commit to anything call the energy supplier and ask them to provide concrete proof and documentation from the renewable generator themselves.
Hopefully in the not too far future, Ofgem will firm up their policy and require energy suppliers to provide clearer evidence of the exact provenance of their renewable energy sources.