One advantage of switching to an energy marketer for your energy supply is the possibility to choose "green" alternatives. However, this usually involves paying a slightly higher cost for your energy. Is it worth it?
What is Green Power?
"Green" power refers to renewable energy sources that have minimal negative environmental impacts compared to traditional energy sources. Electricity produced from low-impact hydroelectric sources, biogas, some biomass, solar, and wind sources are considered by most to be "green". Electricity produced from low-impact hydroelectric sources, biogas, some biomass, solar, and wind sources are considered by most to be green. Some competitive energy retailers offer packages that allow you to supply your home with green energy.
Why choose a green energy supply?
Source: Province of Ontario
As the above chart demonstrates, Ontario relies heavily on nuclear power. Green energy contracts offer to offset your energy consumption with 100% renewable energy, going above and beyond the standard set by the province. As the premium charged by green energy contracts goes towards supporting renewable energy projects, choosing to purchase green power provides additional support to renewable energy development within the province and throughout the country.
What about government initiatives to promote green energy?
The province of Ontario has passed a number of initiatives to encourage renewable energy. It was the first government in North America to implement a Feed-in Tariff (FIT) policy to promote renewable energy development, and the 2009 Green Energy Act promotes renewable energy expansion, energy conservation, and the creation of 'clean energy' jobs. Ontario has recently made a committment to phase out coal as a source of electricity generation, and the last coal-fired electricity generating station closed in 2014. Ontario is expected to expand the role of renewable energy in its energy mix, with forecast electricity for 2025 at 46% renewables (including hydro), 42% nuclear, and 12% natural gas.
While these efforts should not be understated, some competitive retailers may be able to do better. Some offer to supply 100% renewable-sourced electricity to compensate your electricity consumption. Others purchase carbon offsets and Renewable Energy Certificates (REC) on your behalf, allowing you to offset the impacts of your energy consumption.
If I sign up for a green power contract, will I be receiving green electricity?
Energy marketers provide green energy in the following two ways:
- They match the quantity of your energy consumed with a green energy supply that is added to the system. Renewable Energy Certificates (REC) are retired on your behalf
- They offset your energy consumption by purchasing REC or attributes and retiring them on your behalf
As is not possible to distinguish one type (or source) of energy once it has entered the system, there is no way of knowing if the energy that you consume is green. However, the REC that are retired on your behalf allow you to claim the associated environmental benefits.
What about natural gas?
Natural gas is a non-renewable, fossil-fuel resource, and while it is lower in carbon than other fossil fuels, it is not considered a green energy. However, two competitive retailers offer different ways of "greening" your natural gas supply. One private energy marketer offers a green option for natural gas. This natural gas is sourced from a methane-capture project situated on a landfill. Another competitive retailer offers to purchase carbon offsets on your behalf, corresponding to your consumption.