The Short Answer
A REGO, or Renewable Energy Guarantee of Origin, is a certificate that proves one megawatt hour of electricity came from a renewable source. However, buying a green tariff backed only by REGOs does not necessarily mean your supplier is generating or directly purchasing renewable electricity on your behalf. The certificate and the actual electricity can be, and often are, bought separately.
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What Is a REGO and How Does It Work?
REGOs are certificates issued by Ofgem, the energy regulator for Great Britain. When a renewable generator, such as a wind farm or solar installation, produces one megawatt hour of electricity, Ofgem issues a corresponding REGO certificate. This certificate acts as proof of origin and can be tracked, traded, and eventually retired, meaning it is permanently assigned to a specific supply and cannot be reused.
The system exists to give consumers transparency about where their electricity comes from. In theory, if your supplier holds enough REGOs to cover your usage, they can claim your supply is renewable.
The catch is that REGOs are tradeable commodities. A supplier can buy electricity from any source, including gas or coal fired power stations, and then separately purchase REGOs on the open market to relabel that supply as green. Because REGOs have historically been cheap compared to the actual cost of renewable generation, this approach costs suppliers relatively little while allowing them to market tariffs as fully renewable.
Matched Tariffs Versus Direct Procurement
Not all green tariffs are created equal. The distinction that matters most is between REGO matched tariffs and direct procurement tariffs.
With a matched tariff, your supplier buys electricity from wherever is cheapest on the wholesale market, regardless of source. They then purchase REGOs separately to cover your consumption. The electricity you actually use may well have come from a gas power station, but the REGO certificate allows the supplier to call it green on paper.
With a direct procurement tariff, the supplier has a power purchase agreement or similar contract with specific renewable generators. The electricity they supply is backed by both the physical output from those generators and the associated REGOs. This approach tends to cost more because the supplier is genuinely committing to buy renewable electricity, not just certificates.
Some suppliers go further still, owning their own renewable generation assets or investing in new capacity. These models can offer stronger claims to additionality, meaning they may contribute to building more renewable infrastructure rather than simply relabelling existing supply.
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Every electricity supplier in Great Britain must publish a fuel mix disclosure, showing the percentage of their electricity that came from different sources over the previous year. You will usually find this on your supplier's website, often in a document called the fuel mix or energy mix statement.
Ofgem requires suppliers to break down their mix into categories such as coal, gas, nuclear, and renewables. They must also show the associated carbon dioxide emissions and radioactive waste figures.
When assessing a green tariff, look carefully at the renewable percentage. A supplier with a high renewable figure across their entire customer base is more likely to be genuinely buying renewable power. If the company's overall fuel mix is heavily weighted towards gas but they still offer a green tariff, that tariff is probably relying on purchased REGOs rather than direct procurement.
Be aware that the fuel mix label shows the supplier's average across all customers, not the specific makeup of your individual tariff. Some suppliers provide tariff specific disclosures, which can be more useful if you want to understand what you are actually paying for.
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The Criticism of REGO Matching
Consumer groups and environmental organisations have raised concerns that REGO matching can mislead customers. When REGOs are cheap and plentiful, a supplier can dress up a standard grey electricity supply as green with minimal effort or cost. This does little to support new renewable generation or reduce overall emissions from the grid.
The GHG Protocol, which provides the main international standards for corporate carbon accounting, addresses this issue in its Scope 2 guidance. Under the market based method of Scope 2 reporting, companies can use instruments like REGOs to claim zero emissions electricity. However, the guidance notes that the quality of such claims depends on whether the certificates meet certain criteria, including being sourced from the same market as the electricity consumption and being retired within a reasonable timeframe.
For businesses reporting under frameworks like the Streamlined Energy and Carbon Reporting rules, relying solely on REGO matched tariffs may not satisfy stakeholders or auditors looking for evidence of genuine emissions reduction. Many organisations now seek tariffs with stronger additionality claims or invest in on site generation to support their net zero commitments.
From a domestic consumer's perspective, a REGO matched tariff is not worthless. It does create some demand for certificates, which in turn creates a revenue stream for renewable generators. But if your goal is to actively support new renewable capacity or meaningfully reduce the carbon intensity of the grid, a matched tariff may not deliver what you expect.
What to Look for When Choosing a Green Tariff
Whether you are a household or a business, there are several things worth checking before signing up to a green energy tariff:
- Ask whether the tariff uses REGO matching or direct procurement. Suppliers with genuine renewable contracts will usually be happy to explain their approach.
- Check if the supplier owns or invests in renewable generation. Some smaller suppliers operate their own wind or solar assets.
- Look at the supplier's overall fuel mix, not just the tariff's marketing claims. A company with a genuinely green portfolio is less likely to be relying on certificate arbitrage.
- For businesses, consider whether the tariff will stand up to scrutiny under GHG Protocol Scope 2 guidance or other reporting standards you follow.
- Look for third party accreditation. Some tariffs carry certification from schemes that set higher standards than the legal minimum.
Ofgem publishes guidance on fuel mix disclosure and maintains the REGO register. For the latest rules on how suppliers must evidence their green claims, the Ofgem website is the authoritative source. Businesses with complex energy needs may also find relevant guidance from the Department for Energy Security and Net Zero on broader energy policy matters.
Frequently Asked Questions
Does a REGO backed tariff mean my home is powered by renewable electricity?
Not necessarily. Electrons on the grid are mixed regardless of tariff. A REGO confirms that renewable electricity was generated somewhere, but it may have been bought separately from your actual supply.
Are REGO matched tariffs a form of greenwashing?
They can be, depending on how they are marketed. If a supplier implies direct renewable supply but is only buying certificates, that may be misleading. However, REGO matching is legal and meets the minimum regulatory standard.
How can I find out if my supplier directly procures renewable electricity?
Ask them directly and check their fuel mix disclosure. Suppliers with power purchase agreements or their own generation assets will usually provide details on request.
Where can I check the latest rules on green tariffs?
Ofgem publishes guidance on fuel mix disclosure and the REGO scheme. For business carbon reporting, the GHG Protocol Scope 2 guidance provides internationally recognised standards.
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