Green around the bills

“When we started, people thought we sat around in camouflage trousers, open-toe sandals and had offices underneath the Newbury bypass. Not any more. Now people understand that what we do is part of the mainstream.” How times have changed in the seven years since Douglas Stewart set up Green Energy UK, one of a number of niche energy providers specialising in energy with an environmental ethos. Since then, a raft of retailers have signed up to meet at least some of their energy requirements using green tariffs, as an alternative to brown energy, the standard tariff from polluting sources such as fossil fuels or nuclear power.

Green energy covers not just wind, sun and tidal power but also energy produced using low-impact methods, including combined heat and power. “We are ethical pragmatists,” adds Stewart. “There is a limit to the amount of renewable energy and if you rely on wind power and the wind doesn’t blow then you have no power.”

Waitrose switched to 100 per cent green energy for 2007/08, up from 40 per cent in 2006/07, under a contract with EDF. Earlier this year, it took its efforts a step further in a neatly circular scheme whereby tomato producers which exclusively supply Waitrose also began to supply it with electricity.

The tomato farms in Chichester and Stansted use on-site combined heat and power to produce carbon dioxide to feed tomatoes and heat, as a by-product, both to warm the greenhouses and to drive a turbine, creating electricity. The excess is sold to Waitrose’s Rickmansworth store.

Bill Wright, energy and environment manager at Waitrose owner John Lewis Partnership (JLP) recalls: “We thought it was a really good way to support their business and promote sustainable energy. We are now looking at some other fruit and vegetable companies.”

Soaps and cosmetics retailer Lush began its transition to green power in the third quarter of 2007, with its manufacturing site the first to switch over. Since then, about 95 per cent of its stores have also changed to a green tariff, omitting only those where landlord conditions preclude change.

Lack of transparency

“When we went for a green tariff we considered all the options but we went for Ecotricity because it invests in green power,” says Lush environmental officer Ruth Andrade. “This felt like the right ethical option rather than choosing a major provider that was perhaps only offering a green tariff to meet renewable obligations.”

Lush also intends to promote Ecotricity to its customers, with a campaign scheduled for July that will include Lush vouchers for those switching over.

Wright stresses that JLP does not declare its green energy usage as part of its carbon footprint reduction “as we made the decision because we believe it’s the right thing to do”.

For all the good intentions, making an informed decision is not always easy. A report by the National Consumer Council (NCC) in 2006 found a lack of transparency in the market, says Cassie Higgs, senior policy advocate at the NCC. “There is very limited information available on green tariffs. It is important that there is clear information in a standard format so buyers can make comparisons. We also need a certification scheme, with a label that can be trusted.”

Carbon Trust senior strategist Harry Morrison adds that retailers must carry out due diligence. “Proper audit tracking of the energy you buy is very complicated and many of the environmental benefits are already covered off before you buy the power,” he says. “If the primary purpose is symbolic, then go for it. If the main reason is lower carbon intensity then you are likely to be disappointed.”

However, Morrison stresses that there are suppliers “trying to make a real difference” and says: “I don’t want to decry those efforts. We are absolutely behind renewable energy in the UK and we need more of it.”

There is also hope for buyers as industry watchdog Ofgen is due to issue revised guideline proposals for green energy this summer, with the objective of using legislation to make buying more transparent.

Industry consensus is that the premium for buying green is up to 5 per cent more. Morrison adds: “I would advise retailers to look at energy usage. The best way of going green is to reduce consumption.”

Andrade says that Lush has looked at its own energy use and has introduced timers for store lighting, cash till screens that go black when not in use and an educational DVD. That approach is echoed at JLP, as Wright makes clear: “The biggest opportunity is in education. We have 67,000 associates who can help us and the message is, ‘if in doubt, turn it off’.”