Policy update: Change to guide on 'green' tariffs

IEMA's Nick Blyth on potential changes to Defra guidance on reporting GHG emissions from green power

Defra is running a four-week consultation on new corporate greenhouse-gas (GHG) reporting guidance for renewable or “green” electricity tariffs. IEMA is concerned that the revised guidance could lead to confusion in how organisations report GHGs and, in some cases, lead to an under-representation of corporate emissions.

The environment department’s 2009 GHG guidance advises organisations to report electricity consumption using the grid average emission factor and only allows a reduction in net emissions if a purchased tariff demonstrates clear additional carbon savings. Many experts feel this approach is best suited to the UK, where public funding has been a lead driver in securing electricity generation from renewable sources. Some organisations, however, would like to account and report using zero-carbon generation characteristics for any renewable electricity they purchase.

In its consultation, Defra is proposing to enable such reporting and outlines two options. In option 1, gross GHG emissions are calculated using the grid-average factor and zero-carbon characteristics of purchased green renewable electricity can be accounted in net emissions. Option 2 factors in zero-carbon characteristics to the reporting of gross and net emissions. In the second option, organisations will report at least two figures for emissions; if they use net and gross lines four values will be reported.

Both options are a significant change to the 2009 guidance, which is widely used. IEMA believes that option 1 will be a more proportionate change and is concerned that option 2 could be confusing. There are also concerns that option 2 could disincentive firms from installing energy-efficiency measures. Members involved in GHG reporting are encouraged to respond to the Defra consultation. The consultation closes on 24 March.