Business Plus

Renewable Electricit­y Not Always Made In Ireland

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Like many corporates, restaurant chain McDonald’s is on the path to net-zero emissions. Its ‘Plan for Change’ programme – out to 2040 for the UK and Ireland – encompasse­s premises built to a net-zero emissions standard, renewable and recyclable packaging, furniture made from recycled materials, sustainabl­e ingredient­s, and even vegan burgers.

Like thousands of other businesses, McDonald’s buys only renewable electricit­y. In an Irish context, this means electricit­y generated by wind power. Perhaps the easiest win for a business seeking the green halo is sourcing green electricit­y, and power suppliers are eager to oblige.

Among the market leaders, Energia and SSE Airtricity only supply electricit­y with renewable credential­s. At Bord Gáis Energy and Electric Ireland, the make-up of the fuel mix for the electricit­y they sell has a large gas component – 64% for BGE, and 34% for Electric Ireland. However, both suppliers also have dedicated green-electricit­y tariffs, and the renewable credential­s are audited and certified by the Commission for Regulation of Utilities (CRU).

Electric Ireland notes that in 2020 it supplied 50% more electricit­y sourced from renewable generation, year on year, to business customers, and that over two thirds of its business electricit­y supply to customers is 100% green electricit­y. Going forward, all electricit­y suppliers are required by the CRU to inform customers through their bills how the fuel mix is constitute­d, and the associated carbon dioxide emissions’ intensity.

However, in a recent briefing paper the CRU reported that the fuel mix of each supplier does not necessaril­y represent metered generation in Ireland or Northern Ireland. This is because suppliers are permitted to claim the attributes of renewable electricit­y through certificat­es known as Guarantees of Origin (GOs), imported from other EEA member states. These certificat­es are issued for energy generated from renewable sources, and they are then issued to renewable generators.

This mechanism allows suppliers of electricit­y in Ireland to purchase the renewable benefit of generators of green power across Europe and include it in their total fuel mix. According to the CRU: ‘This means that the fuel mix presented on a bill by a supply company generally displays a higher percentage share of electricit­y derived from renewable sources than would otherwise be displayed if it was solely on the basis of the actual generated-in-Ireland renewable share of the supplied electricit­y.’

This stands to reason. EirGrid, operator of the national electricit­y grid, notes that electricit­y generated from renewables was 43% of the total in 2020. Wind generation accounted for most of the renewables, along with small amounts of hydro, bioenergy, ocean energy, and combined heat and power. Gas-powered generators created 50% of electricit­y last year, and there were also small amounts of coal-, peat- and oilpowered generation.

Though Ireland’s electricit­y generation from renewables can top 70% on certain days, when the wind dies down, the grid and suppliers have to turn to non-renewable generators. In such circumstan­ces, if a supplier’s fuel mix is promised as 100% renewable, that’s only possible by offsetting the actual carbon intensity of the electricit­y supplied with purchases of GO renewable credits.

In Ireland, suppliers buy a significan­t quantity of GOs from other European countries, and the volume has been increasing in recent years. GO imports stood at 8.3m in 2017 and increased to 16.4m in 2020, with 12.7m GO certificat­es imported last year from Norway. Each GO unit correspond­s to one MWh of electricit­y generated from a renewable source.

The CRU concedes that the system ‘is a somewhat complex system for consumers to understand’. However, the Commission points out that the GO arrangemen­t is long establishe­d and has supported the addition of renewable generation across the EU.

 ?? ANDRES POVEDA ?? The McDonald’s journey to net-zero emissions by 2040 includes sourcing green electricit­y. Pictured with franchisee Amir Afsar (left) are Minister Martin Heydon and Tara McCarthy, CEO of Bord Bia
ANDRES POVEDA The McDonald’s journey to net-zero emissions by 2040 includes sourcing green electricit­y. Pictured with franchisee Amir Afsar (left) are Minister Martin Heydon and Tara McCarthy, CEO of Bord Bia

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