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What is green energy?

Martin Lane Photo
Written by Martin Lane, Managing Editor

1 February 2019

Green energy is better for the environment than fossil fuels, and could help you save money on your energy bill too. Here is everything you need to know about green energy.

Green energy wind turbines

How does it work?

Green energy is generated from natural resources like sunlight, wind and water. Unlike traditional fuel sources, it is renewable and causes less pollution.

You can sign up to a green energy deal with a supplier, or you can install renewable technology to create your own power supply.

You can find green energy tariffs using our comparison.

Can you buy green gas?

Yes, but it may be difficult to find a supplier and is often more expensive than standard gas.

How is green energy made?

The main ways of generating green energy are solar power and wind. You can install equipment at home to generate your own energy supply:

  • Solar power: Panels fitted to your home use light from the sun to create electricity or heat water. They work best on south facing roofs which get the most sunlight. Solar panels can cost up to £9,000, so it may take time for you to save on your energy bill.

  • Wind energy: You can install a small wind turbine at your home to generate your own electricity. They work well in the UK because of the windy weather, but cost upwards of £3,000 and need maintenance checks every few years.

There are lots of other ways to create renewable energy, and many are used on a larger scale, like:

  • Hydroelectricity which converts energy from water, like rivers or streams

  • Biomass like crops, manure, or wood which can be burned for heat

  • Geothermal uses heat from the earth's core to produce electricity or heat

  • Biodiesel fuel which is made from natural oils can be used in cars

What is microgeneration?

It is where you install equipment or technology that lets you generate your own energy at home, rather than buying all of your gas and electricity from a supplier.

You can even sell the energy you produce back to some suppliers, and get paid for the gas or electricity you generate.

How much does it cost?

Green energy tariffs tend to be more expensive than standard energy, but many specialist suppliers offer competitive deals if you are a new customer looking to switch.

If you install renewable technology in your home, you may be able to get help from the Government and you could also get money for the energy you generate.

Domestic Renewable Heat Incentive (RHI)

You could get money towards the cost of heating your home if you use:

  • A biomass boiler

  • Solar water heating

  • Some types of heat pump

You need to live in England, Scotland or Wales, and you must be a homeowner or a private landlord to claim.

How to make money from renewable energy

You can apply to get payments from your energy company if you generate your own electricity, with solar panels or through a wind turbine. This is known as a feed in tariff (FIT).

If your application is accepted, you get a set amount for each unit of electricity you generate depending on:

  • The size of your system

  • What you have installed

  • When it was installed

  • How energy efficient your home is

How can you find a supplier?

British Gas is the only one of the big six energy suppliers that offers a green energy tariff, but there are lots of smaller energy companies who provide green deals.

Green energy companies, like Ecotricity and OVO, specialise in providing affordable renewable energy to households in the UK.

You can find green energy tariffs in your area by entering your postcode in our energy comparison and then filtering green and environmental tariffs.

Who are the big six?

The main energy suppliers in the UK are British Gas, npower, EDF, E.ON, Scottish Power, and SSE.

Are green tariffs 100% green?

Not all green tariffs use 100% renewable energy, but most green suppliers get a higher proportion of their power from renewable sources.

Look out for the Ofgem Green Energy Label Scheme, which shows that suppliers are going above the basic requirement to source renewable energy.

Is it worth it?

You could save money with a green energy tariff and support the development of renewable energy sources.

Installing your own equipment to generate green energy can be expensive and it may take time for you to see the savings, so only do this if you can afford the initial cost.