Wednesday 27 August 2008

Is Your Green Electricity Tariff Just a Con?

Ecotricity takes a different approach. It guarantees that it will invest some of its customers' money in building new renewable energy, and thereby increase the total amount of renewable power generated in the UK. Dale Vince, founder of Ecotricity, argues that what is really needed is greater certainty for renewables investors, and that the best way of doing this is through providing dedicated funds for investment. Controversially, Vince does not believe that retiring ROCs is worthwhile, as it does not send a clear signal to the market: 'it's a very poor second-best to actually building something.'7 As these examples show, there are some genuinely green deals around, but cutting through the confusion is difficult to achieve. Even those familiar with energy issues struggle to assess the relative merits of the different tariffs.

The Advertising Standards Agency recently took British Gas to task for claiming that it was selling 'the greenest energy tariff in the market', on the grounds that there was no way of verifying the claim. The National Consumer Council blames the confusion, and lack of independent verification, for the less-than-impressive levels of enthusiasm among would-be -greener householders.8 Many businesses, too, are calling for greater clarity. As companies are increasingly being asked to count their carbon, they need to know what sort of electricity they are buying. BT, for example, is working with energy suppliers, the gas and electricity market regulator Ofgem, the Carbon Trust and others to get some basic information about the carbon content of the power that it buys.

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