The UK government has announced a review into how energy retailers market green tariffs, amid concerns that some suppliers are misleading consumers by labelling fossil fuel-derived electricity as '100% renewable' or 'green'. The Department for Business is investigating whether providers need to offer clearer information about the types of renewable energy used, its origin, and generation time.
Currently, nine million British households are on green energy products. However, critics accuse some companies of 'greenwashing'—using marketing spin to make dirty energy appear clean. Climate and Energy Minister Anne-Marie Trevelyan stated: 'Millions of UK households are choosing to make the green switch... but I want people to know that when they sign up to a green tariff, they are investing in companies that make a conscious choice to invest in renewable energy.'
A key issue is the use of Renewable Energy Guarantee of Origin (REGO) certificates. When renewable energy is generated, Ofgem issues a REGO to the producer, who can sell the electricity and certificate separately. Suppliers can buy leftover REGOs for as little as £1-£2 per customer per year, allowing them to offset fossil fuel purchases and label the mix as green. Critics argue this practice misleads consumers who believe their electricity comes directly from renewable sources.
Uswitch.com's head of regulation, Richard Neudegg, supported the review, saying: 'More and more people are purchasing green tariffs but it's been difficult for bill-payers to know exactly what's under the hood of these deals. We support any measures that aim to demystify green tariffs for households.' The review will also consider whether price comparison websites and auto-switching services should be regulated.
Dr Jeff Hardy, a senior research fellow at Imperial College London and former Ofgem official, called the situation 'consumer mis-selling' and urged urgent reform. 'Not all suppliers are offering the same product and we need to be able to tell the difference,' he wrote. The government aims to ensure transparency as it pursues its target of net-zero emissions by 2050, with home energy use accounting for 15% of UK greenhouse emissions.
