15 April, 2002 – UK energy regulator Ofgem has issued new guidelines aimed at helping customers to make an informed choice when choosing an environmentally friendly electricity supply.

The guidelines set out the criteria that Ofgem recommends suppliers adhere to when they advertise a supply as being green. Currently the market in the UK has been estimated to have 60 000 green tariff customers. Ofgem said that the market is estimated to be worth around £15m ($21.3m) a year.

The green supply guidelines include: setting out what forms of generation constitute ‘green energy’; explaining the key features customers should expect from a ‘green’ supply, and describing which standards, regulations and guidelines apply in this area and who enforces them.

A number of regulators and self-regulatory bodies have responsibility in this area, including the Trading Standards Service and the Advertising Standards Authority. The guidelines can help these bodies, Ofgem said. The Energy Saving Trust said it would now revise its green energy accreditation scheme to incorporate the new guidelines.

Ofgem’s guidelines suggest there is no single definition for green power supply. It identifies three terms. “Green supply offering” is an agreement between an electricity supplier and a consumer where it is claimed the supply will provide environmental benefits. “Energy-based green offering” refers to a supply contract where there is a direct relationship between energy supplied and the purchase of energy by the supplier, such as where the supplier meets all a customer’s supply with energy purchased from a renewable source.

“Contribution-based green offering” refers to supply contracts where suppliers make a donation on behalf of the consumer to bring about an environmental benefit. Techniques such as combined heat and power are environmentally friendly, but not “green supply”.