UK government to review green retail electricity tariffs

The sun rises behind electricity pylons near Chester, northern England October 24, 2011. REUTERS/Phil Noble

LONDON, Aug 16 (Reuters) - The British government said on Monday it will review green retail electricity tariffs due to concerns that energy companies could be exaggerating how environmentally friendly their products are.

The government said 9 million British households are on "green" tariffs, with more than half of all new electricity tariffs launched now labelled as "100% renewables" or "green".

The review will look into whether the current system is transparent and whether the rules around what can be called a green tariff remain fit for purpose.

Currently, energy companies are able to market tariffs as green even if some of the energy they supply comes from fossil fuels, as long as this is offset by purchasing renewable energy certificates.

For a tariff to be labelled as green or 100% renewable, a supplier must be able to show evidence that they are in possession of enough certificates to cover the energy consumed by customers on that tariff.

The review will explore whether this system needs to be improved, as well as whether suppliers need to provide clearer information to households about the type of renewable energy used, where the renewable power was generated and when, the government said.

"I want people to know that when they sign up to a green tariff, they are investing in companies that make a conscious choice to invest in renewable energy," said Anne-Marie Trevelyan, minister of state for energy and clean growth.

Reporting by Nina Chestney; Editing by Kirsten Donovan

Our Standards: The Thomson Reuters Trust Principles.