65% of domestic UK energy customers are now supplied by Green Energy Suppliers
Energy suppliers that only offer electricity backed by Renewable Energy Guarantee of Origins (REGO) certificates are snapping up increasing numbers of customers with their green energy tariffs. So much so that they’ve now managed to snap up 65% of the domestic market.
Growing popularity for Green Tariffs
According to a new study released by Cornwall Insight, energy suppliers that only offer green tariffs have seen their market share rise from less than 20% in 2017 to 65% in 2021 as awareness of climate change has increased dramatically.
Climate change and the need for renewable energy is constantly in the media and the shift to cleaner energy has received huge financial and political backing from the current Conservative government.
Businesses of all sizes have also jumped on the green bandwagon with many now using their ‘green’ credentials as marketing tools to entice customers concerned with environmental issues.
The study points out that the percentage of households on green tariffs would be even higher if the green tariffs also offered by energy suppliers who also offer non- green tariffs as well were included in the data.
“This boom in green tariffs is in part being driven by consumers doing their bit to reach net-zero with renewable credentials increasingly being factored into decision making when switching energy providers. For example, Ofgem’s Consumer Perceptions of the Energy Market survey showed that in Q1 2019, 9% of respondents gave green energy as the main reason for switching supplier. In Q4 2020, this had risen to 19%,” said a senior analyst at Cornwall Insight.
Also read: Green Tariffs alone not enough to attract Environmentally minded consumers
Rebranding
As well as the increased awareness of green issues in the media, some energy suppliers have rebranded to be 100% green suppliers.
Between 2019 and 2021 several large suppliers have undergone green rebrands and according to Cornwall Insight this has accounted for 80% of the increase in green tariff customers. Octopus Energy and Bulb are the best examples of this and as such both companies have seen their market shares increase strongly.
With REGO certificates still at low prices (albeit they are on the rise) it’s never been easier for an energy supplier to label itself as green and keep its main selling point of providing cheap tariffs. Over half of the energy suppliers on the market now market themselves as green.
Also read: ‘Green’ Tariffs to come under increased government scrutiny over growing ‘Greenwashing’ concerns
Greenwashing
Green Tariffs have come under criticism by several energy suppliers with Scottish Power and Good Energy leading calls for REGO certificates to be regulated more tightly. They claim that the current system allows suppliers to claim they are ‘green’ when they aren’t as well as make it hard for consumers to understand which suppliers genuinely supply 100% green electricity.
With more and more green tariffs entering the market the government has announced plans to launch a consultation later this year to decide what reforms are needed to provide more transparency to consumers.
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Further Reading
Energy Supplier Customer Satisfaction fell to an all time low in Q1 2021 says Ofgem data
Monthly Energy Supplier Switching fell unexpectedly in May
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