Green Energy Options for Businesses

Choosing a “green” energy option means your business’s electricity (and possibly gas) comes from renewable or low-carbon sources, at least on paper. Many businesses are considering this to reduce their carbon footprint or meet sustainability goals. The good news is that it’s easier than ever to go green with your energy supply. Here’s what you need to know about green energy tariffs and options:

Renewable Electricity Tariffs: Most suppliers nowadays offer 100% renewable electricity contracts for businesses. If you opt for this, the supplier guarantees that for every unit of electricity you use, an equivalent amount generated from renewables is fed into the grid (tracked via certificates called REGOs – Renewable Energy Guarantee of Origin). Practically, your power comes from the same grid mix, but you’re sponsoring clean generation. These tariffs often cost the same as, or only marginally more than, standard tariffs. In fact, some major suppliers have made their default business contracts renewable as the cost difference has become negligible. Before assuming green power is expensive, get quotes – you might be surprised that it’s very competitively priced (see our quote comparison tips). By choosing a renewable tariff, you’re essentially investing in and promoting renewable energy production in the UK, and you can legitimately claim your electricity use is carbon-neutral in Scope 2 reporting.

Green Gas Options: Renewable gas (often called biomethane or “green gas”) is trickier, but some suppliers offer a percentage of green gas in their mix or fully carbon-offset gas. Biomethane comes from sources like anaerobic digestion of organic waste. It’s limited in supply, so a 100% biomethane contract might be more premium. More commonly, suppliers offer to offset the carbon from your gas usage by funding carbon reduction projects (not exactly making the gas renewable, but balancing it out). If gas is a big part of your footprint, you can ask about green gas or offset options. Even a 10% biomethane blend is something. It may come at extra cost, so weigh that against your goals.

On-site Generation: Another way to green your energy is to produce it yourself. Solar panels on your rooftop, for instance, can directly supply a portion of your electricity with zero carbon. Prices for commercial solar have come down, and there are even schemes like Power Purchase Agreements (PPAs) where a provider installs panels on your site and sells you the power at a fixed rate (often lower than grid electricity). If you have the roof space or land, on-site generation can be a great long-term hedge against both high prices and carbon emissions. It requires investment (or a PPA arrangement), but it gives you control. Some businesses also look at technologies like small wind turbines or battery storage, though solar is the most common for SMEs.

Renewable Energy Certificates and Claims: It’s worth understanding REGOs (for electricity) and their international equivalents (like GoOs in Europe, or RECs in the US). These are the mechanisms that certify energy as renewable. When you buy a green tariff, you’re essentially buying the certificates that match renewable generation. This system isn’t without controversy – some argue it’s too easy to be labeled “100% renewable” by buying certificates. However, it’s the standard way to do it and does channel money to renewable producers. For marketing and CSR, you can confidently say you use renewable electricity if you’re on a REGO-backed tariff. Just be aware that not all green tariffs are equal – some suppliers directly source from their own wind/solar farms (more impactful), while others just buy certificates from the market. If this matters to you, you can ask your supplier for details.

Cost Considerations: As mentioned, the cost gap between green and “brown” energy has largely closed for electricity. Many renewable tariffs are priced the same as standard, especially for electricity. For gas, offsets might add a small premium. But keep an eye out for any hidden costs. Some suppliers might charge a bit more for 100% renewable as a way to improve margins, even if it doesn’t cost them much – so it’s still wise to compare multiple offers. Also, if you’re on a fixed budget, you could choose a partially green option (like 50% renewable) if available, or prioritize green electricity (which is easier) and stick to normal gas.

Benefits for Your Business: Going green isn’t just about feeling good – it can have business advantages. You can enhance your brand image (customers and partners increasingly value sustainability). You’ll be prepared for any future regulations or carbon reporting requirements that penalize fossil fuel use. And if your competitors boast green credentials, you won’t want to be left behind. Some businesses also find that using renewable energy is a selling point in tenders or investor relations. In short, it can open doors or at least keep you on a level playing field in a world moving toward net-zero.

Overall, green energy is more accessible to businesses than ever. Whether you simply switch to a renewable electricity tariff or invest in your own generation, every step helps reduce reliance on fossil fuels. If navigating these options seems complex, we’re here to assist. We can identify the genuine green deals and explain any cost implications. Feel free to ask us about green energy when we review your contracts – we’ll incorporate sustainability into the savings plan for your business.