SQUEAKY FMD Guide v2 Fuel Mix Disclosure User Guide

: June 15, 2024
: SQUEAKY

Table of Contents

FUEL MIX DISCLOSURES
- WHAT IS A
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FUEL MIX DISCLOSURES

Is your energy supply really as clean as you think it is?

WHAT IS A

FUEL MIX DISCLOSURE?

A Fuel Mix Disclosure (FMD) is a piece of statutory reporting which each and every UK licensed
electricity supplier must produce annually as part of the conditions of holding a standard electricity
license (known as SLC).

The FMD was introduced in 2005 with the aim of helping customers (whether domestic or commercial), know the makeup of the power they are buying. Suppliers must disclose this information to Ofgem each year by 1 October for the previous annual supply period (1 April to 31 March).

The FMD is a high-level overview of each published on their website.

LIMITATIONS OF THE FUEL MIX DISCLOSURE

Why does the Fuel Mix Disclosure matter?
If your business is concerned about its environmental impact, it is likely you will have chosen a `green’ energy tariff.

The FMD matters because it is the key piece of easily available information which tells you about the makeup of the power you are buying and helps you make more informed choices on your path to net zero.

Does my supplier’s Fuel Mix Disclosure tell me everything I need to know about my energy makeup?
Sadly not.

The FMD is an important tool, but in our opinion, it just does not go far enough. And there are a few reasons why.

Read on to find out more.

THE MAIN PROBLEM WITH THE FUEL MIX DISCLOSURE: IT’S NOT SPECIFIC ENOUGH

The FMD only breaks energy sources into five categories:

Coal
Gas
Nuclear
Renewable
Other

So, essentially - fossil fuel, nuclear and renewable. But unfortunately, `renewable’ in this context is something of a catch-all term and covers a wide range of energy sources.

Not all renewable energy is clean

The term renewable doesn’t necessarily mean non-polluting, sustainable or carbon neutral. For the purposes of the FMD, renewable’ includes, not only clean sources (wind, solar, water, hydro and tidal), but energy sourced from a range ofbrown’ sources too, including biomass, landfill gas, sewage gas and biogas.

Unfortunately, when one reads the term renewable energy’ most of us tend to think of wind, solar and hydro power sources. But there’s a good chance your renewable’ energy tariff is actually being powered by `brown’ sources. This will come as a surprise to many.

But what do we mean by this?

Some suppliers use the word `renewable’ to disguise the fact that their energy source isn’t in fact, clean. One good example is imported biomass. The UK government considers biomass to be a renewable energy since the biomass pellets are made from trees. But when you consider that burning biomass creates just as much CO2 as burning coal and the fact that all of those pellets are manufactured outside of the UK, often in places as far away as in North and South America, and given they are then shipped to the UK by fuel- powered boats, that so called green energy starts to look an awful lot browner.

What is `clean energy’?
Genuinely clean energy translates as energy derived from natural, non- polluting resources that are capable of being replenished on a short timescale, such as wind, solar, geothermal, wave, tidal and hydropower.

HOW RENEWABLE ENERGY IS VERIFIED FOR THE FUEL MIX DISCLOSURE

Each year, suppliers submit their annual Fuel Mix Disclosure data to Ofgem for the previous supply year (1 April-31 March).

For every MWh of energy labelled as renewable energy, either a UK REGO or an EU GO must be submitted to Ofgem.

A UK REGO is a certificate of proof issued to the organisation generating renewable energy (e.g. a wind farm or solar park) to show that the energy produced is renewable.

An EU GO is the EU equivalent for energy produced outside of the UK. EU GOs can be applied to UK supply, but have multiple downsides, including the fact they do not contribute to the UK’s clean energy transition.

It is important to remember that both REGOs and GOs can be bought on their own and packaged with fossil fuel energy, which is then badged as `renewable’.

RENEWABLE PORTION OF FUEL MIX DISCLOSURE

UK REGOs|

EU GOs

HOW TO GET TO GRIPS WITH YOUR ENERGY SUPPLY

Going beyond the Fuel Mix Disclosure

In our recent survey of 250 sustainability and energy managers who work at FTSE250 and equivalent size companies, we asked them “What do you rely on to ensure your supplier is providing you with the energy they say they are?”

40% of respondents said they simply rely on their supplier to tell them, whilst 14% said they rely on the FMD of their supplier.

Only 15% of sustainability and energy managers at some of the UK’s biggest companies look up how many REGOs their supplier has requested – information which can be found on the Ofgem website.

How do sustainability and energy managers clarify the source of their energy?

40%
rely on their supplier to tell them

23%
do their own due diligence

15%
check Ofgem to see how many REGOs their supplier has redeemed

14%
rely on their supplier’s Fuel Mix Disclosure (FMD)

To really get to grips with the source of your energy, you need to dig a little deeper. Information really is power.

By not understanding the true source of your power, you could be falling foul to greenwashing albeit inadvertently.

COMPARE YOUR SUPPLIER’S FUEL MIX DISCLOSURE TO OTHER SUPPLIERS

This first step is easy. You simply need to navigate to your supplier’s website and take a look at their FMD. This will immediately tell you if there are obvious fossil fuels in your energy supply.

To make things even easier though, we have compiled a table of the UK’s key I&C suppliers’ FMDs for the last available reporting period (1 April 2022-31 March 2023) below.

Fuel Mix Disclosure of key UK I &C suppliers 2022-2023

Company| Coal (%)| Gas (%)| Nuclear (%)| Renewable (%)| Other (%)| Carbon CO2 Emissions (g/kWh)| Radioactive Waste (g/kWh)
---|---|---|---|---|---|---|---
British Gas| 2.0| 17.0| 26.0| 54.0| 1.0| 88.00 | 0.00180
Drax (also incorporates Haven)| 0.6| 6.6| 0.2| 92.1*| 0.5| 34.00| 0.00001
E.ON| 0.0| 0.0| 0.0| 100.0 | 0.0| 0.00| 0.00000
EDF| 1.6| 16.7| 59.4| 21.0| 1.3| 87.00| 0.00420
Engie| 2.0| 25.0| 0.6| 70.0| 2.0| 130.45| 0.00004
Npower| 4.6| 48.6| 1.1| 42.0| 3.7| 253.00| 0.00010
Shell| 0.0| 0.0| 0.0| 0.0| 0.0| 0.00 | 0.00000
SmartestEnergy| 2.0| 21.3| 0.5| 3.5| 72.7| 111.00| 0.00000
Squeaky| 0.0| 0.0| 0.0| 100.0| 0.0| 0.00 | 0.00000
SSE| 0.0| 47.0| 0.0| 53.0| 0.0| 175.00 | 0.00000
TotalEnergies| 4.0| 43.0| 1.0| 49.0| 3.0| 221.00| 0.00010
UK Fuel Mix 22/23**| 17.0| 225| 89| 493| 84| 1,099.00| 0.00625

Table 1: Fuel Mix Disclosures for the reporting period 1 April 2022-31 March 2023 | Source: supplier websites

Drax Renewable volume includes 25.3% biomass
** Squeaky’s energy is not only renewable but 100% clean – sourced purely from wind, solar and hydro with no fossil fuel legacy
NB: FMD data is by supplier across their entire business

UNDERSTANDING WHERE YOUR ENERGY COMES FROM IS CRITICAL TO YOUR BUSINESS

REACHING NET ZERO

The most important thing you can do for your business’ transition to net zero is to buy clean energy.

As we’ve explained, it is crucial to ensure the energy you are procuring is genuinely clean. To do that, you may need to dig deep to understand the makeup of your supplier’s energy.

We know this can be daunting. Not least because there is a lack of transparency. And we know that suppliers may have `dirty’ secrets. But, taking the steps we’ve outlined in this guide will give you the tools you need to make an informed decision about your energy supply.

This is essential due diligence that will mean you understand more about your energy. But, more than that, you will reap wider benefits too.

Here is an opportunity to mitigate the risk of greenwashing, make serious progress towards net zero targets, and increase your knowledge and understanding of this critical issue.

Moreover, this is an opportunity for your organisation to lead the way in clean energy.

Lead the way.

CONTACT US

For 100% clean energy direct from UK wind, solar and hydro sources, get in touch today.

Brendan O’Flaherty, Development Director
020 8051 9791 | brendanoflaherty@squeaky.energy

© 2022 Squeaky Clean Energy Group Ltd. E&OE
Squeaky Clean Energy Group Ltd. Registered in England and Wales, Company No.13173060
Registered Address: 151 Wardour Street, London, W1F 8WE