Generic Carbon Emissions Question 5

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Question

EN: Is at least XX% of the electricity used by the brand (company) generated from renewable resources, such as wind or solar energy?
NL: Is tenminste XX% van het elektriciteitverbruik van het merk (bedrijf) afkomstig van duurzame bronnen, zoals wind en zonne-energie?
DE: Stammen mindestens XX% des kompletten Elektrizitätsverbrauchs des Markenherstellers aus erneuerbaren Quellen?

Reference

This question relates to disclosure GRI 302 of the Global Reporting Initiative’s reporting standards.

Renewable energy or 'green energy' generally emits fewer GHG emissions than other sources of energy that supply the electric grid. Examples are solar photovoltaic panels, solar thermal energy, geothermal energy, landfill gas, low-impact hydropower, and wind turbines. This description is found on page 98 and chapter 4 of the Greenhouse Gas Protocol.

Renewable energy is energy that comes from natural resources such as sunlight, wind, rain, tides, and geothermal heat, which are renewable (naturally replenished), see also the Greenhouse Gas Protocol. Renewable energy or 'green energy' generally emit fewer GHG emissions than other sources of energy that supply the electric grid.

Additionality required, type and sources should be revealed

The energy industry is a complicated sector. Although the energy supplying the electric grid can be either green or 'brown' (i.e., coming from fossil fuel), the type of electricity generated from both is identical and indistinguishable. Moreover, a separate 'green electricity grid', so to speak, does not exist. As a result, buying green electricity does not actually means that one taps green electricity from the grid - it only means that the supplier added electricity from green energy to the grid.

However, even this is not always the case. When paying a premium for green electricity, one may think this promotes the transition to using only green energy, because more green energy will be supplied to the grid than would otherwise be the case. Such additionality is not guaranteed, though. Rather than actually building new wind turbines or solar panels, energy suppliers sometimes simply buy certificates that allow them to call their self-generated brown energy green.

In the Netherlands, for example - and probably other countries as well (see Cool IT report p. 27 about 'Renewable energy credits') - energy suppliers can buy cheap Scandinavian hydroelectricity generated with dams that were built in the 60's through Guarantee of Origin certificates. This means that the energy supplier can now call its own brown energy green, whereas the Scandinavian hydroelectricity now becomes brown. As Scandinavian certificates are still abundant, new green energy is unlikely to be generated, there is no additionality to business-as-usual, and certainly no reduction of carbon emissions or incentive to further invest in renewable energy. Because such greenwashing may occur at a large scale, we only consider electricity generated from hydropower eligible when specific claims about additionality are made, for example by employing certificates such as Öko power or through verification websites.

Another way to demonstrate additionality is by following Google’s policy . The company buys electricity directly through Power Purchase Agreements (PPAs), sells it back into the grid at local wholesale price, strips it from its Renewable Energy Certificates (RECs), then sources energy from the grid, and in doing so applies its RECs.

Nuclear energy not green
Opposed to what nuclear energy suppliers might claim, nuclear energy is not green or clean. Although direct carbon emissions are zero, the indirect carbon emissions from mining and building a nuclear plant are huge. Nuclear energy is not renewable, and nuclear waste is persistent. Furthermore, nuclear plants are dangerous: remember Tsjernobil and Fukushima disasters.

Biomass is suspect
Another way to generate energy is through biomass, for example by burning wood or other organic matter. Such energy is renewable, because trees, for example, can be planted anew. Biomass is controversial, however, and Greenpeace claims it may even harm people, the climate, and forests. When biomass is transported across the globe, or when forests have no time to regrow in full, for example, biomass is anything but sustainable. Following EU and UN standards, we count biomass as sustainable for now, but we encourage less controversial sources of renewables such as wind or solar, and may take this into consideration for updated future criteria.

Ranking Guidelines

We ask companies to:
- (partly) generate renewable energy e.g. by solar panels or wind mills and use this for own consumption (instead of selling green certificates to the market), and/or;
- directly purchase green energy (through Power Purchase Agreements - PPAs)
- refer to green energy percentage of the electricity product as purchased from the power supplier (so NOT the grid average)
- report Guarantees of Origin (GoOs) or Renewable Energy Certificates, including from which country exactly the energy came from and what type of energy (e.g., wind, solar) is generated. If electricity is generated from hydropower, the company must provide extra evidence of additionality as outlined above.

AND NOT only:
- refer to average green energy percentages in the grid without any furthers statement if or why this percentage can be attributed to the brand (company) electricity use. For example, the green electricity portion in the grid average could have been sold through certificates to other parties, and should therefore not be attributed twice.
- mention to use green energy without providing any further details, or information about the type of resource.

Answering Guidelines

‘Yes’:

  • [Brand] reports for [year] to have used [??]% renewable energy on total electricity consumption. This was purchased [e.g. where, what certificates, what type of renewable energy?]/ this was generated by own [windmills/solar panels etc..].
  • [Brand] uses renewable energy for its electricity consumption in its own premises only. This energy is purchased [e.g. where, what certificates, what type of renewable energy?]/ this was generated by own [windmills/solar panels etc..].

?:

  • [Brand] does not communicate its renewable energy policy.
  • [Brand] does not clearly communicate its renewable energy policy. Sustainability information should be easily accessible for consumers to make responsible choices.
  • [Brand] refers to the grid average of ??% renewable energy, but does account for the reason why this portion can be attributed to the brand.
  • [Brand] reports for [year] to have used [??]% renewable energy on total electricity consumption, but is not clear about the sources of supply.
  • [Brand] reports for [year] to have used [??]% renewable energy on total electricity consumption. But, sources, types and additionality of supply are not specified clearly enough.
  • [Brand] mentions to use renewable energy, but does not make clear from what kind of resource, nor gives any details about the country of origin.
  • [Brand] mentions the use of onsite generated renewable energy, but is not clear about the total percentage share.
  • [Brand] reports on the use of renewable energy, but is neither clear about the total percentage share nor about the sources of supply.
  • [Brand] reports on the use of renewable energy, but is not clear about the total percentage share, kind of resource and additionality of supply.
  • [Brand] reports on the use of renewable energy, but is not clear enough about the overall share of renewable energy consumption, as well as sources, types and additionality of renewable energy supply.
  • [Brand] reports using hydroelectricity from [country], but is not clear enough about its additionality.

No:

  • [Brand] explicitly states not to ... .
  • [Brand] reports for [year] to have used only [??]% renewable energy on total electricity consumption. This was purchased [e.g. where, what certificates, what type of renewable energy?]/ this was generated by own [windmills/solar panels etc..].


-* You can pick the topic that applies to 'your' brand.

Note: when linking to a downloadable source document, please refer to the page(s) where to find the respective information with: (see link, page [..]).

Optional, but only for ? Answers, feel free to write at the end of a remark: Sustainability information should be easily accessible for consumers to make responsible choices.

Further resources

  • Umweltbundesamt - Herkunftsregister 1 2
  • TÜV NORD - Criteria 1
  • TÜV SÜD - Criteria 1
  • ok-power - Criteria 1
  • GrünerStromLabel - Criteria 1
  • Öko-Institut - “Additional” renewable energies 1