Greenwashing

So, as one of my final pieces of (dead tree) mail from Good Energy following my switch, I got their latest news booklet (and information on their latest price increase… :mrgreen:)

Within this booklet they once again mentioned “greenwashing” where suppliers apparently simply buy REGO certificates but don’t actually purchase any renewable electricity (Green Tariffs and REGOs | About REGO Scheme | Good Energy).

Presumably there aren’t any more REGO certificates than units of green energy being created, so isn’t this basically a non-issue?

On a related note however, for Bulb to “purchase” their energy from the renewable generators listed on the fuel mix page, do they simply contact them to buy all of their REGO certificates directly?

Am I missing something obvious in my post-new year tired state?

It’s something of a non-issue in our minds. REGOs are sold at market value and there is only one REGO per MWH of green energy. So the more popular green tariffs become, the higher the cost of the REGO and so more money goes to renewable generators. That said, we buy our REGOs from same generators that we buy our power from.

The article didn’t mention additionality. For a tariff to be advertised as green it also needs to do something else to go above and beyond for the environment. We supply 10% green gas and we donate to a charity called Trees For Cities as our additionality.

We feel that the more people on green tariffs, the better. But that said, we think it’s best to go with a supplier that’s 100% green, rather than any supplier with a green tariff. Regardless of who you’re with, a proportion of your fuel bill will go towards helping that supplier get more people to join them, so it’s better to give it to suppliers that will only help other people go green too.

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It's something of a non-issue in our minds. REGOs are sold at market value and there is only one REGO per MWH of green energy.
Glad to hear I'm not miles off the mark. Can REGOs come from other countries, in the same way that power is imported (some of which may/will be renewable)?
That said, we buy our REGOs from same generators that we buy our power from.
Is there a benefit to this aside from establishing a relationship with the generators?
We feel that the more people on green tariffs, the better. But that said, we think it's best to go with a supplier that's 100% green, rather than any supplier with a green tariff. Regardless of who you're with, a proportion of your fuel bill will go towards helping that supplier get more people to join them, so it's better to give it to suppliers that will only help other people go green too.
Agreed. Good Energy also did a blog post about why it's important to go with a 100% green electricity supplier.

@mowcius Out of interest, how much more were you paying with Good Energy? I’ve just done a comparison and my bill would be 55% higher! Maybe that’s why they try to frighten the environmentally conscious with stories of greenwashing.

@xxx, my leaving/joining figures as folows (Yorkshire):

Supplier Gas SC Gas Unit Rate Electricity SC Electricity Unit Rate
Good Energy 29.80 4.013 26.89 15.27
Bulb 24.56 2.516 24.56 12.03

So not 55% but not insignificant. Their price increase will have changed this though.

I do believe that Good Energy do and have done a lot of good, but they seem very rooted in old ways, are pretty poor with technological adoption, and aren’t open in the same way that Bulb seem to be.

Glad to hear I'm not miles off the mark. Can REGOs come from other countries, in the same way that power is imported (some of which may/will be renewable)?

Yes. All EU member states are required to have a guarantee of origin (GOO) scheme. Our’s are REGOs. Ofgem is required to recognise foreign GOOs for fuel mix disclosures, so yes, we could buy foreign GOOs instead of REGOs. Here’s a bit more info on it if you’re interested - Guarantees of Origin (GoOs)

We’re looking into whether we want to have some of our power backed by EU GOOs, but we haven’t made a firm decision yet.

Bulb seems second tier in terms of renewable power additionality to Good Energy or Ecotricity then, since these guys reportedly actually directly cause new renewable capacity to be built? The REGO matching situation doesn’t cause any absolute reduction in greenhouse gas emissions. Does Bulb have plans to directly finance new, green capacity? (REGOs don’t count since no one builds a new wind farm on the basis of extra revenue from these green certificates)

As to Bulb’s “additionality criteria” (green gas / planting trees) - this seems misleading to customers in my opinion… especially with those “equivalent to planting [*] trees” adverts you guys ran a while back.

Also, what % of Bulb’s electricity comes from long-term renewable PPAs with solar. wind etc. developers?

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Bulb seems second tier in terms of renewable power additionality to Good Energy or Ecotricity then, since these guys reportedly actually directly cause new renewable capacity to be built? The REGO matching situation doesn't cause any absolute reduction in greenhouse gas emissions.
Agreed. Good Energy and Ecotricity both invest directly in new renewable generation facilities and Good Energy at least offers shares to their members when they invest in somewhere new.

The fact that Bulb is increasing people’s awareness of renewables and showing a meteoric rise in demand for them surely accounts for something though.
Even if people have just moved for the prices then perhaps the warm fuzzy feeling of being supplied by renewables will affect their decision on suppliers to consider in the future.

Heya @browntown

I left a reply to your other post. Let’s move the discussion over to that post if you’ve got any questions or opinions.

Hello @Will_at_Bulb,
I’m very confused by this REGO thing.
You say REGOs are bought at market value, does that mean the same price as the actual energy?
So if a wind farm produces 1 MWh of energy they get a REGO. Then they sell their energy to the grid at market value, let’s say £50. Then they sell their REGO to bulb, they get another £50?Meanwhile bulb has paid £100 for 1 MWh + REGO, twice the amount they would have paid if they had bought their energy from a nuclear plant?

Rego’s are sold separately, and are still really cheap…

Hi @Will_Guillaume.

I’m not @Will_at_Bulb but I’ll be able to help with this.

We agree - the electricity market can be confusing. We’ll try and simplify it for you.

REGOs can be bought in a separate market to physical power. So the market value of REGOs isn’t the same as the market value of power. As you say, power can be bought at ~£50/MWh. In 2015, the price of a REGO was about £0.20/MWh, today it’s ~£0.70/MWh.

The price of REGOs has more than tripled in the last 3 years, mostly because of increased demand for UK renewables. In 2015, only 1% of the UK were on a renewable tariff. Today, that figure is closer to 10%.

There are no more REGOs than there are units of renewable power. So a renewable generator will always be paid the market price for the green power they produce.

Hi @Eleanor_at_Bulb,
So when Bulb is supplying “100% renewable energy” it’s actually supplying energy that REGOs have been bought for, do I get this right?
So for 1 MWh sold you could potentially buy 0.2 MWh solar, 0.8 MWh coal then spend £0.7 for a REGO and you can call it “100% renewable”?
Would it be possible to know how much renewable energy is actually in the mix of the energy bulb sells if we don’t count REGOs? Thank you.

Hey @Eleanor_at_Bulb i’ve been following this topic closely as its something that im really interested in.

My understanding that the larger ‘Big 6’ energy companies are required to generate i think around 20% of their electricity from renewable sources, who sell their REGOs separately to their renewable electricity. So by buying REGOs an energy company doesn’t really create anymore additional renewable capacity?

Also stated in your web page here (How Bulb buys its electricity – Bulb) you only have PPAs for 20% of your electricity and rest is off the wholesale market? Why don’t you have PPAs for the vast majority of your electricity demand from renewable generators? Buying it from the wholesale market is not giving 80% of your revenue to renewable generators which would help them increase their capacity?

Have i got that right?

As Bulb don’t generate any of their own power, they can’t “Greenwash” any of their energy, however this doesn’t necessarily make it as green as it could be.

REGOs are created for every unit of renewable energy created. By buying REGOs, you are effectively allocating that created unit of renewable energy to your supply. In that sense, all of the energy that Bulb supplies is green.

The issue with this lies where companies have some renewables (often because they have to), which they don’t “use” for their customers (as their customers don’t pay for “green energy”), so they sell off those REGOs to companies like Bulb. As those REGOs are basically always going to be there, there’s potentially no additional demand being created by buying them. If they didn’t get sold, the same amount of renewable energy would be being supplied.

Then there’s actual greenwashing where companies (like Shell) generate dirty power, then buy left over REGOs from other companies, effectively replacing their dirty grid energy with renewable energy for their customers. Their dirty energy is still going into the grid and being sold to customers who don’t know/don’t care about paying for renewables.

If you want the greenest renewables, you want to buy from a company that owns enough renewable generation for all of their customers, or has direct purchase agreements with renewable generators to cover all of their customers’ demands. Although this still involves REGOs, they’re primarily a formality in this case to show/ensure that the energy company is “getting” all of the renewables for their customers.

So a company owning renewable generators but selling on additional REGOs (companies like Orsted have more renewable power than customer usage) are more of a problem than the companies who don’t own their own or directly support a lot of independent renewable generators?

Well, if they generated the power but destroyed the unsold REGOs then that would probably be the most beneficial option, but I can’t see that happening any time soon.

I don’t think there’s a simple answer to whether or not they’re “more of a problem” though. More of what problem?

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Hey @Eleanor_at_Bulb and @Will_at_Bulb.
I would still like to know how much renewable energy is actually in the mix of the energy bulb sells if we don’t count REGOs. Could we have the breakdown of how much of the energy Bulb buys is coal etc? Thanks.

I don’t think you quite understand.

None of what they buy is coal.

Some of what they buy is with direct purchase agreements, so they get the REGOs along with the energy, all in one go. This directly supports those renewable generators, as well as renewable generation as a whole, by increasing demand.

Some of it is extra renewable energy that others have put on the grid that they just pay for the REGOs for, so they can claim it as theirs. This very rarely increases demand, it’s just what others have left over that they don’t need (from what they are legally required to generate, or just what is left over after they have serviced their customers).

Bulb have also now updated their page to make things a little clearer: How Bulb buys its electricity – Bulb

If you want to be with a supplier that is the most beneficial for the future of renewable energy, go with a company that generates all of their energy themselves, or has PPA/DPAs for all of it.