Why choose a renewable electricity tariff?

Can I really buy renewable electricity, or is the whole renewable tariff thing just a political stunt?

It is to an extent political, and it is to an extent how capitalism works. 

Starting with how the grid and distribution system works:

Imagine instead of electrons, the grid is a big water reservoir (the power pool).  It is essential that the amount of water in the reservoir stays constant. We are on the south side taking out water, so someone needs to put in water to cover what we take out.  We used to just buy water from the ‘pool’, but today we have to buy from someone who is putting water into the reservoir.  Say we agree with someone on the north side that they will put in what we use.  It’s clear that we won’t actually take out the water molecules that they put in.  In fact, if someone next to us is putting in water, we will probably actually take out their molecules.  But one molecule is the same as another and so it doesn’t make any difference.  The point is, we have made an agreement, outside of the reservoir, with someone who is putting water into it.  So we might choose a ‘renewable water’ provider (e.g. a rainwater collector) to put water into it, and then we claim that we are using renewable water – it is as if we had a direct pipe from them to us.

But, if we didn’t make that agreement with the rainwater collector, he would still put his rainwater into the reservoir!  So what’s the benefit of us making the agreement to buy electricity from him?

Well, he had to invest in his rainwater capture system, and he needs to know that he’s going to get his investment back.  If he doesn’t have a specific agreement for the water he captures then he will only be able to sell his water at the price anyone will pay – which may be close to zero!  So by choosing to buy ‘renewable water’ we would be allowing him to know that he can safely invest in his new plant and get his money back.

Buying from a renewable tariff is the mechanism whereby politics and capitalism invests in renewable energy.  And it seems to be working!  The proportion of wind and solar has grown dramatically, at the expense of coal.

(source https://www.ofgem.gov.uk/data-portal/electricity-generation-mix-quarter-and-fuel-source-gb)

So in practice, are we using renewable energy each time we switch on a light? 

No, not at all.  There would be a certain mix of generation producing the power that everyone else is using before we switch on our light.  That would already include all the renewable sources, and ‘carbon free’ nuclear.  Every extra kW that has to be generated would come from fossil fuel.  i.e. every time we switch on a light, the marginal generation will be the highest carbon producer!  Hence we should continue to minimise our usage, even on a renewable tariff. 

And it will be the same if we have solar panels and generate our own electricity – every kW that we don’t use will prevent someone else having to use fossil fuel generated electricity so we should still minimise our use.

As the amount of renewables increases though, we may get to the stage where there is no fossil fuel generation at all.  When we reach that point, we still need to balance the peaks and troughs of demand but with unpredictable renewable supply.  For that reason people are developing ways of storing the overproduced electricity (like if we fit panels, we might fit a battery to save the electricity generated when the sun shines for when we need it).   I recently did a bit of consultancy work for a company developing a compressed air energy storage project – a bit like pumped storage at Dinorwig but using compressed air pumped in to vast salt caverns underground. 

Another way to store the excess electricity is to convert it through electrolysis into hydrogen gas.  And gradually the expectation is that hydrogen will replace natural gas in the grid – hence some organisations who want to fit gas heating are buying ‘hydrogen ready’ equipment.  But to my mind, that will be a long way off, and since hydrolysis process is only around 60% efficient, gas must be less energy efficient that direct use of renewable electricity.

Carbon offsetting is again a mechanism whereby politics and capitalism can lead to the right projects going ahead.  The route is a bit indirect, and it can be an excuse to keep burning fossil fuels and so it should only be the last resort.

Hope this makes things clearer…

2 thoughts on “Why choose a renewable electricity tariff?

  1. Interesting. My brother is involved in off shore wind turbines. (He’s off to Dunbar soon) 

    Sent from Yahoo Mail for iPhone

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