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UK: Regulator seeks clearer green energy tariffs

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Britain’s energy suppliers must stop labeling any electricity tariffs “green” unless they commit to spending more of their own money on environmental projects, according to new guidelines from UK energy regulator Ofgem.

Under government schemes aimed at cutting carbon emissions, 8-10% of all domestic gas and electricity bills already goes towards increasing renewable power generation. Growing concern over global warming has seen about 350,000 householders sign up to “green” supply deals, which are often more expensive than standard payment plans and make consumers feel they are lessening their contribution to climate change. But some of the tariffs are just a re-packaging of existing subsidies with no extra money being spent on eco-friendly energy projects by the sellers and no environmental benefit over standard tariffs.

“We want suppliers to stop re-packaging their existing environmental activity as green immediately and to align their marketing with our guidelines by September 2008,” Ofgem chief executive, Alistair Buchanan, said on Wednesday. “With our revised guidelines we intend to shine a light onto suppliers’ green offerings to show the customer why a tariff is green.”

Under guidelines that could become compulsory if the utilities do not adhere to them voluntarily, suppliers must prove their green tariffs will provide additional environmental benefits above those already paid for with existing subsidies. “If suppliers really want to show customers that their green tariff is doing something extra then they will have to show that by putting more of their own money into developing future renewable schemes,” a spokesman for the regulator said. Ofgem said it would work with suppliers to set up an independent verification scheme before the end of the year. (Reuters)

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