At the moment only the largest industrial and commercial customers can choose their power suppliers. Homes take what they are given by local regional electricity companies. But when this monopoly ends in September, 25 million domestic customers will be able to buy electricity from any firm. People who worry about the effects of energy production and consumption on the environment will at last be able to put their money where their mouths are.
But there's a catch. Electricity from environmentally-sound renewable sources such as wind, water and the sun costs more than the conventional sources of coal, oil, gas and nuclear power. "Green" customers will pay a premium of around 10 per cent.
Some electricity firms are already offering green tariffs to customers. The first was South Western Electricity (SWEB), which set up Green Electron in October to buy electricity from small hydro-electric projects and landfill gas generators. Neil Humphreys, of SWEB, says the project needs 10,000 customers paying a 10 to 15 per cent premium to break even. In theory it is available to all SWEB's 1.3 million customers, although Mr Humphreys says there aren't yet enough generation projects to meet demand if take- up is high.
Gerry Swarbrick, 41, lives in a four-bed semi in Bristol with his wife and three children. Their electricity bill is high - around pounds 500 a year. But he also pays a pounds 15 quarterly premium to guarantee that SWEB, through Green Electron, buys enough electricity generated from renewable resources to supply his needs. "I was the first domestic customer in the UK to choose green electricity," he says. "My kids came home from school with a Green Electron leaflet and I wanted to support the renewable business. It's a feel-good thing." He is confident that competition and higher demand for renewable energy will cut the cost of providing it.
Today just 2 per cent of Britain's electricity comes from renewable resources. The Government has pledged to increase this to 10 per cent by 2010. It has also promised to reduce carbon dioxide emissions by 20 per cent by 2010. A typical windfarm can save 50,000 tonnes of CO2 emissions a year.
A Mori poll in 1996 suggested that one in five consumers is prepared to pay more for power from greener sources. However Offer, the regulatory body, expects the cost of electricity to the customer to fall from around 8p per kilowatt hour to nearer 7p per kwh after competition is introduced, making renewables even more expensive relatively. David Infield, director of the Centre for Renewable Energy Systems Technology (Crest) at Loughborough University, says persuading a part of the public to pay more for green electricity is not going to be easy. "It is not like organic food in the supermarket where you pay more for something different; the end product is exactly the same. People say they are willing to pay more, but when it comes to the crunch they don't."
There is also disagreement about what can be labelled green electricity. The World Wide Fund for Nature objects to the inclusion of waste incineration, which includes landfill gas projects, as a "renewable" energy source. "We have reached an impasse," says Karen Gill, who works on renewable energy policy at the WWF. "The DTI says renewables are anything that is non-fossil or non-nuclear and this includes waste incineration. Our view is that the waste stream is made of non-renewable products and that incineration produces dioxins and CO2 emissions, so it shouldn't be classed as green electricity."
The group is one of a number of environmental, industry and consumer bodies being consulted by the DTI before an eco-labelling scheme to identify green electricity is set up. Consumers need to be confident about the green credentials of the power they are choosing to buy. An initial certification scheme is expected to be in place before competition is introduced.
What you can do now
q If you live in South-west England you can buy green electricity if your supplier is SWEB - 0345 419484.
q Northern Ireland Electricity has a green tariff for existing customers at a cost premium of 15 per cent - 01232 661100.
q Eastern Electricity customers can choose Eco Power or Eco Power Plus tariffs, at a 5 or 10 per cent premium matched pound-for-pound by the firm; proceeds go to an independent charitable trust to support wind, wave and solar power projects and other research - 0345 601 1290.
q Green tariffs will be widely available when the roll-out of electricity competition in the regions begins in September.
q Look out for green tariffs this summer from Scottish Power and its subsidiary Manweb.
q The Renewable Energy Company, based in Gloucestershire, will take a different approach, offering customers "green electricity for the price of brown". The firm will match customers' existing bills but will meet at least half the demand from renewable sources - 01453 756111.Reuse content