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Renewable energy is expensive – fact or fiction?

Find out if you could pay less to go green for gas and electricity

Renewable energy is expensive – fact or fiction?

Paying a premium for renewable electricity is a thing of the past. Choose a cheaper renewable energy tariff and you can reassure yourself you’re going green without being out of pocket.

The average annual cost of a tariff that claims 100% renewable energy is £151 less than the average annual cost of being on a standard variable tariff with one of the Big Six energy companies.

But choose your tariff carefully. There’s a £367 difference in price between the cheapest and priciest tariffs offering 100% renewable electricity. Long-established renewable energy company Ecotricity costs £1,221 per year for a medium user. Newcomer Tonik Energy is the cheapest, at £854 per year.

The number of energy deals boasting renewable electricity has multiplied rapidly over the last year. There are currently more than 30 tariffs to choose from (as long as you’re happy to manage your account online).

Here we compare the renewable credentials of both new and established green energy tariffs, plus how their costs stack up.

If you’re keen to switch to a renewable company or tariff now, use our independent energy switching service Which? Switch? to find the best green energy supplier for you.

Good Energy and Ecotricity logos

Renewable electricity tariffs compared

The average annual cost of a tariff that claims 100% renewable electricity is currently £1,000 per year.

That’s £151 less than the average annual cost of being on a standard variable tariff with one of the Big Six energy companies, proving that you no longer have to choose between ‘going green’ and saving money on gas and electricity.

Many of the 100% renewable electricity tariffs are from smaller newcomer energy firms established within the last couple of years.

But the more established, and bigger, energy firms are also now offering pricier renewable electricity tariffs. Big Six firms Eon and Npower have joined established green giants Good Energy and Ecotricity in offering tariffs with ‘green’ credentials.

To get a cheap deal and 100% renewable electricity you’ll have to look to smaller and newer firms, such as Bulb, Engie and Tonik.

  • There are five 100% renewable electricity tariffs costing less than £900 per year
  • But there are 15 with 100% renewable electricity that cost more than £1,000 annually

Which renewable energy tariff is best?

But if you’re truly considering going green for energy, some firms offer more than 100% renewable electricity. ‘Green gas’ is part of some firms’ tariffs, generated from the breakdown of biodegradable material. Others help fund new generation or support community projects.

Energy firms’ customer service can also set them streets apart.

Use our research, below, to compare the tariffs that offer other environmental benefits beyond 100% renewable electricity:

  • Bulb Vari-Fair: 10% green gas
  • Co-operative Energy Green Pioneer: Helps fund ‘Green Community Grants’ for community energy projects
  • Eon Clean Energy Fixed 1 Year v1: 100% gas matched with renewable energy guarantee of origin and green gas certificates
  • Ecotricity Green Electricity: 12% green gas
  • Engie Green Fixed Sept 18 v4: 100% renewable gas, donation to Engie Community Energy Initiative which supports sustainable energy projects
  • Good Energy & Gas+: 6% green gas
  • Green Energy Sparkling: 100% green gas
  • Npower Cleaner Energy Fix October 2019: Electricity used is matched by energy generated from renewable sources (subject to availability)
  • Octopus Energy Super Green Octopus: Carbon offset for gas
  • Ovo Energy Greener Energy: Five trees planted per customer
  • Pure Planet 100% green: Carbon offset for gas

The rise of renewable electricity and green gas

Eon recently launched a 100% renewable electricity tariff, as did Npower, adding to the growing list of tariffs you can choose from. The recent increase in ‘green’ tariffs is because the energy regulator, Ofgem, removed a rule that had previously limited each energy supplier to offering just four tariffs.

More firms are now also offering ‘green gas’ – Ecotricity was the first. Recent research from small renewable energy supplier Engie found that half of consumers said they don’t consider green tariffs because they think their bills will rise.

Is renewable energy getting cheaper?

The price to be paid for offshore wind was set at a new low in the recent government reverse auction to award clean electricity contracts. This means that it will cost less than gas power plants, and far less than nuclear. So there’s the potential for the cost of low-carbon energy to help reduce consumers’ bills in future.

It’s already possible to choose a cheap energy deal and buy renewable electricity. The cheapest deal overall on the market (if you’re not interested in buying renewable electricity) costs only £20 less than the cheapest green deal, per year, at present.

Our research

Data is from Energylinx, and prices are based on a medium energy user (using Ofgem averages of 3,100kWh electricity and 12.500kWh gas per year), paying by monthly direct debit with paperless billing. Prices are averaged across all GB regions and correct on 18 September 2017.

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