Great Britain’s current fuel mix disclosure is nearly 20 years old and no longer fit for purpose, says SmartestEnergy, as it sets out a new approach to put consumers at the heart of the energy transition
SmartestEnergy has published a new position paper calling for a refresh in the way the origin of electricity is verified. Launched at the UK’s inaugural REGO Day taking place today, the paper entitled Hitting Reset: Reforming Britain’s Fuel Mix Reporting to Build Consumer Trust advocates to reform the fuel mix disclosure and associated electricity certification scheme.
SmartestEnergy is proposing a shift to a more transparent and reliable disclosure – increasing the trust consumers place in Great Britain’s electricity decarbonisation process and simultaneously accelerating investment into it.
To meet the government’s new target of Clean Power by 2030, consumers must be empowered to make environmentally responsible and informed decisions about their electricity supply. The Hitting Resetposition paper proposes the following changes to be enacted over the coming years, if Great Britain wishes to achieve its bold ambition:
- A shift to mandatory issuance and retirement of guarantees of origin. All electricity producers, regardless of the fuel source and electricity origination, must receive a certificate of origin for every MWh of power they inject into the grid. Electricity consumers must make a choice about electricity based on its attributes by purchasing a certificate for every MWh supplied to them.
- Closer temporal alignment between physical electricity flows and all energy certificates of origin, moving from current annual matching towards a more granular approach. This temporal alignment will demonstrate the need for a diverse portfolio of renewable and low-carbon generation to better match businesses’ seasonal and daily energy demand profiles, helping to encourage investment into grid development and deeper decarbonisation, ultimately reducing emissions associated with scopes 2 and 3.
Vishnu Aggarwal, Deputy VP Origination and Renewables Trading, SmartestEnergy, said, “We need to hit reset on how we’re disclosing information about the origin of electricity in Great Britain. Businesses are all at different stages in their energy transition, but what unites them is a lack of sufficient clarity to make sound decisions about their energy supply and move confidently towards net zero. To achieve our clean power ambitions as a country, we need an approach that will ensure everyone is better equipped with the necessary data and information to understand the origin of where every MWh of electricity comes from.”
Britain’s fuel mix disclosure practice lags behind both the rapidly evolving electricity sector and consumer demands, as well as progress made in other markets (such as the Netherlands, Austria and Switzerland). In its Hitting Reset position paper, SmartestEnergy has called out some of the major problems in current fuel mix disclosure methodology:
- Energy consumers should have a say in where their electricity comes from, now and in the future. Many forms of power generation are not covered by guarantees of origin. With this lack of transparency in what really powers consumers, homes and businesses, they cannot make informed decisions about how they would like the energy transition to look.
- Great Britain recently closed its last coal fired power station, a huge moment in decarbonising our electricity supply. But many will be wondering why they will still see coal in their fuel mix from 2025 and beyond. Consumer trust and buy-in is crucial to meet the ambitious target of Clean Power by 2030.
- Matching does not currently reflect the seasonal fluctuations in renewable supply and demand across the year. This means it does not create a link between the consumer’s choice and a need to invest in additional renewable generation or flexible solutions.
Aggarwal added, “We need to see all consumers being provided with transparent, reliable and complete evidence about the energy they’re using, and we’re already seeing consumers ask for more innovative products to support their energy transition. At SmartestEnergy, we strongly believe these changes are critical to setting the right trajectory for the ongoing energy transition in 2025 and beyond. We would welcome the opportunity to work with the Department for Energy Security and Net Zero (DESNZ) and OFGEM to help align disclosure practices with the ambition of accelerating the decarbonisation of Great Britain’s electricity sector by 2030.”
If you would like to find out more about SmartestEnergy’s Hitting Reset position paper on renewable energy origin, further information is available here, and if you have any feedback on the paper, you can share your thoughts here. To get involved in shaping future plans you can contact the SmartestEnergy team here.
