Blog by Laura Tudor and Emma Andrews

Monday (6 December) was the last day for stakeholders in the energy sector to contribute to BEIS’s review of carbon content transparency in energy products, a developing area for policy makers. This is especially so as the UK energy sector continues on a trajectory of profound change.

As we move ever closer to achieving Net Zero, consumers require accurate and transparent information on carbon content when choosing their energy provider(s). The market is increasingly responding to a spectrum of consumer demands – ranging from those who have “greener” ambitions but are cost conscious, to those who will contribute as much as they can to support decarbonisation. Indeed, over 40% of UK generated electricity is renewable at present and the prices of “green” tariffs are now much more competitive with the standard consumer tariff.  However, there are concerns for customers about “green washing”, which has led to a growing demand for clarity in respect of the carbon content of “green" tariffs, and a real focus on additionality (meaning that via its actions, the customer is contributing to additional renewable energy generation capacity being installed on the system that, but for those actions, wouldn’t have been installed).

It is anticipated that the first call for evidence will enable BEIS to understand the current “green tariff” marketplace, including the challenges and opportunities for both suppliers and consumers.

Given that the current energy framework was implemented some 20 years ago it is now an appropriate time (some would say overdue) for that framework to be reviewed and updated accordingly. In addition, it is important that future policy is flexible enough to maintain an innovative, competitive energy market whilst ensuring an appropriate level of transparency and usability for consumers. As part of its review of submissions, BEIS will be particularly keen to explore what incentives and interventions supplier stakeholders propose to achieve this.

We look forward to seeing the energy sector’s response to the consultation when it is published early next year.  In the meantime, we have seen a sharp rise in interest in this issue from our clients, and they are considering how they can secure a direct link with renewable energy generation in order to clearly evidence they are purchasing green power and are showing additionality.

We are currently working on both private wire arrangements and corporate power purchase agreements across the spectrum of sectors, including for local authorities, utilities and corporates.  The procurement of high quality renewable electricity is now a key strategic focus in all sectors.