Is there a Problem with Renewable Energy Sourcing?
As part of their drive to net zero many members are asking for renewable energy from their suppliers. Reflecting this it is the first target for our climate action roadmap net zero energy in buildings by 2030. To demonstrate it is renewable, power suppliers use Renewable Energy Guarantees of Origin (REGO) certificates and EU Guarantees of Origin (GoO) certificates to underpin their green tariffs. However, surges in demand for renewable energy has outstripped supply meaning tariff prices, as with all energy prices, has soared and in some cases members have reported their power suppliers are unable to confirm they have sufficient REGO certificates to justify their green tariffs. The certificates are tradeable on a market overseen by Ofgem.

Is the Problem Likely to Get Worse?

Prices for the renewable energy certificates have stabilised recently following large rises through 2022. However, the Government is currently consulting on whether the UK will accept EU GoO certificates (the EU no longer accepts REGOs as a demonstration of renewable energy production) which could reduce the market further. The UK Government hopes the increase in demand for green tariffs and concerns on energy security will drive rapid expansion of renewable energy production and that it will keep pace with growing demand, which they recognise will increase as more companies implement net zero strategies.

What can the BRC do to help?

We have spoken to Government officials at BEIS to explain concerns about meeting net zero commitments and the cost of renewable energy contracts. They have agreed to talk to members to explain Government policy on renewables, their expectation for supply in the next 5 years and what this means for businesses implementing their net zero plans. They have asked their analysts to prepare research on this and we aim to share it with members later this year.