@prjohn I signed up too for the same triff as it sounds like it will go up even more in the autumn. So, at least we are at a fixed rate until next February.

Ofgem issue 1 UK REGO certificate for every 1 mega watt hour of green electricity generated in the UK.  The Green Energy generators can then sell these certificates. These are traded completely separately from the actual wholesale electricity market. So your supplier can buy a mix of electricity on the wholesale market and then enough UK  REGOs to call their energy mix 100% green. The UK REGO may actually have been created many months earlier when there was perhaps a lot of wind. There is no link between when the UK REGO certificate was created and when it was used by your energy supplier. UK REGOs can be traded multiple times until they are actually used. 

The EU generate their own certificates for energy created in the EU. Currently EU certificates can be used in the UK for energy imported to the UK. So if your energy company uses electricity generated in Germany it would use an energy certificate created in the EU currently. 

Although UK REGOs have gone up in price they are still insignificant, just adding a few pounds on a bill, so they aren't really driving up energy costs currently.

Primarily bills have gone up as gas has gone up. Gas has driven up the cost of generating electricity from gas. Due to the way the wholesale market works green energy generators are also getting paid more for the electricity they generate as per the statement from Octopus. Wind and solar isn't cheaper to buy at the moment, that is the issue. Being cheaper to generate doesn't always mean it is cheaper to buy unfortunately. This should change over time as more energy is created from renewables as Octopus have said. 

@jeff 

Thanks for the clarification, about when REGO's are produced and when they are used.

So if my understanding is correct, electricity suppliers can buy electricity from the generators, which may or may not be from renewable sources, but provided that they also purchase sufficient REGO's they can claim that the electricity supplied is 100% green. 🙄 

I vaguely remember in the early days of renewables, when the government were trying to encourage companies to build solar and wind farms, the companies were being guaranteed prices of £100/MWh or 10p/kWh, when cost of fossil fuel generation was something like £26/MWh or 2.6p/kWh.

Do you know if these solar and wind farms are still being paid at £100/MWh or are they now getting the market rate? If so, they must be raking in the money at the consumers expense. 😮 

@derek-m your are correct about REGO certificates.

So i am on a 100% green electricity tariff and every month on my bill it has the energy mix... See attached. This is what typically happens. All suppliers have to publish their energy mix. You should be able to find the mix from your supplier. 

There are a couple of other options. 

1. A few suppliers might own enough wind farms etc. themselves to in theory provide 100% green energy to their customers. Well at least feed enough green energy into the grid over a year to be able to say that, as the wind doesn't always blow and some homes are too far away from wind farms. As you say there are no green or brown electrons. 

2. A few suppliers attempt to buy some or all their electricity directly from a wind farm etc. and buy the REGOs at the same time from the same wind farm, with the same caveats as above. 

Personally i would recommend people ignore the green tariff blurb and give a donation to a charity to be honest. 

@derek-m it is a good question about the guaranteed prices for non fossil fuel energy.

I would have thought it gives some protection to consumers even given comments from Octopus and OVO about prices. It is not something i have looked at. If you search for Contracts for Difference for electricity there is quite a bit of info which might give an insight about what happens when there is a serious amount of volatility. 

Here's the table on regional prices.

Why is it that rates for "London" are so much lower on that table than anywhere else in the country?

@pauldavies83, it'll probably be down to population density and the "ease" of getting electricity to these homes. We're in the West Midlands/Welsh borders – less population and we have the joint highest rates in the UK.

I suspected so.

But to have that differentiated, but the price according to the source not, seems remarkably unfair.

example:

I have a giant Solar Farm two fields away from me, in the North West / Mersey region. It is much easier to get that power from there to me than anything else. And I have a "100% renewable source" tariff with Octopus. But I get charged one of the highest rates in the country for the easiest to transmit and greenest source we have possible.

The whole "system" is totally broken.

@pauldavies83, we're on the same tariff as you. We're on NW/Mersey tariff.

Dave Pearson, who we interviewed last year, speaks about this in this video – he's in Scotland, and they have a wind farm very close to him. On days when it's windy, there's no demand in the SE or the rest of the UK, these wind turbines don't turn on: https://renewableheatinghub.co.uk/heat-pumps-for-apartment-blocks-and-whiskey-distilleries

Derek has far more knowledge of the grid, and I agree with you. The system isn't fair, and I don't think it's going to get any better.

Posted by: @pauldavies83

I suspected so.

But to have that differentiated, but the price according to the source not, seems remarkably unfair.

 

example:

I have a giant Solar Farm two fields away from me, in the North West / Mersey region. It is much easier to get that power from there to me than anything else. And I have a "100% renewable source" tariff with Octopus. But I get charged one of the highest rates in the country for the easiest to transmit and greenest source we have possible.

 

The whole "system" is totally broken.

Especially when you consider where most of the gas generation occurs.

I guess in my view I see no reason why a renewable producer would want a differing market rate, especially when that rate would be lower. They are in the market because that's how markets work. If I make some gold and I can do it cheaper, why would I charge less for my ounce of gold? Just because the price goes up, doesn't mean I am somehow bound to charge less.

If I can get more for my power, and I can make it cheaper, then that's more margin for me and my business and as such the market encourages more lower cost generation - Gas power plants aren't making lots of profit, gas sellers are. Therefore if you build power assets, why would you build more gas? High gas prices actually encourage renewables as they have, by far, the biggest margins once running - especially at these prices.