Shell Energy’s ‘renewable’ promise highlights the problem with REGOs. The Renewable Energy Guarantee of Origin scheme was intended as a simplification, but has become a loophole. In the words of the UK’s energy regulator Ofgem, the ‘Renewable Energy Guarantee of Origin’ (REGO) scheme is designed to“provide transparency to consumers about the proportion of electricity that suppliers source from renewable generation.” It states that “the purpose of the certificate is to prove to the final customer that a given share of energy was produced from renewable sources.” As originally designed, REGOs were an effective simplification; when a renewable generator produces one megawatt hour (MWh) of electricity (about a third of the electricity an average household will use over a year), Ofgem electronically produce one REGO to prove its source. Meaning that instead of reviewing the provenance of all of their supply contracts to check their sources, all energy suppliers have to do is count up how many REGOs they have to calculate how green their electricity supply is. So far so good. But unfortunately, it is possible for a supplier to source REGOs without also purchasing the electricity they relate to. This wasn’t a major issue in the early days of the scheme as there was only a small amount of trading in REGOs without their power. However, now this loophole is increasingly being taken advantage of at significant scale, with more suppliers claiming to offer ‘100% renewable’ tariffs, despite holding little or no contracts with renewable generators. News in the industry has highlighted this this week. Shell Energy is the new name for First Utility, who in the same breath now suddenly claim to supply their 700,000 customers with ‘100% renewable’ electricity. Making it seem awfully easy to switch a big customer base to renewable sourced power. If we look at First Utility’s last published energy mix (below) they sourced just 3.7% of their supply from renewables. But — as if by magic — post takeover from the oil and gas giant Shell they are now ‘100% renewable’. And all of this without a single article showing partnerships or contracts with a renewable provider.
Good Energy 27th March 2019 read more »