SYDNEY Buying Green Power and Large Scale Generation Certificates User Guide

: May 15, 2024
: SYDNEY

Table of Contents

You’ve got the power to accelerate Australia’s transition to renewably
Myth bust
Glossary
Recognised by
Tips for buying Green Power and LGCs
Handy links:
References
Read User Manual Online (PDF format)
Download This Manual (PDF format)

SYDNEY Buying Green Power and Large Scale Generation Certificates User Guide

You’ve got the power to accelerate Australia’s transition to renewably

sourced energy.

Buying Green Power or LGCs are 2 ways you can prove you’re buying renewable electricity

They show you’re actively helping to increase the amount of electricity generated from renewable sources – like wind and solar farms – in Australia.
By buying Greenpower or LGCs you’ll help accelerate Australia’s transition to renewably sourced energy – above the federal government’s mandated targets.

Green Power

Buying Greenpower is your fastest and easiest way to buy renewable electricity. Greenpower
is a government program that allows households and businesses to support the generation of
electricity from renewable sources. Green Power carries out the administrative work of ensuring a
renewable claim is credible. When you buy standard LGCs, you are required to do this work yourself.
There are a couple of ways of buying Green Power. The easiest way is to opt for a Green Power electricity

plan through your electricity provider. This method of buying renewable electricity is known as
‘coupled’. When you opt for a 100% Green Power electricity plan, your energy provider must buy the
equivalent amount of electricity you use from renewable energy farms.

You can also buy Green Power certificates separate to your electricity plan through a Green Power accredited broker. This method of buying renewable electricity is known as ‘decoupled’.

LGCs

Large-scale Generation Certificates (LGCs) are tradable renewable energy certificates that track
renewable electricity generation. One LGC represents one megawatt hour of generation exported to
the electricity grid by renewable energy generators, like wind and solar farms.

Many companies now voluntarily purchase and retire LGCs to meet their renewable energy or net
zero emissions targets. This market is growing as more companies set and seek to meet similar
targets. Like GreenPower, you can buy LGCs coupled with your electricity contract, or separately.

Myth bust

Many people believe a carbon neutral electricity plan is equivalent to a renewable electricity plan. It’s not. Carbon neutral electricity plans, or buying from a carbon neutral company, doesn’t help get more electricity from wind and solar farms made.

When you have a carbon neutral energy plan, or buy from a carbon neutral electricity provider, your provider is simply offsetting emissions by buying carbon offsets. Companies buy these carbon offsets from climate action projects all around the world. It could be a project like planting trees in regional Australia, landfill management in Brazil, or swapping light fittings in India. It can take years and years for these projects to mop up the carbon in the atmosphere that electricity produced from coal creates today.

To reduce your emissions and claim you’re 100% renewable, you need to buy accredited Green Power or LGCs – not simply buy electricity from a carbon neutral company.

Glossary

| Coupled| Decoupled
---|---|---
GreenPower| GreenPower| LGCs(non-GreenPower)
Description| GreenPower purchased from a GreenPower accredited electricity provider, added (coupled) to your electricity contract| LGCspurchased from a GreenPower accredited broker| LGCs purchased from a broker or other source

Recognised by

Programs that recognise buying GreenPower and LGCs as legitimate

methods for reducing your scope 2 emissions:
NABERS Greenstar B-Corp R100 Climate
Active
SBTi
(Science Based Targets)

Greenpower and LGC purchasing options – pros and cons

| Coupled GreenPower| Decoupled GreenPower| Decoupled LGCs
---|---|---|---
Add to electricity contract| Purchase separate to electricity contract| Annual purchase| 3–7 year purchase
Best suits| Small businesses and organisations with lower annual electricity use, and less experience with energy markets, energy contracts and LGCs| Organisations that don’twant to change electricity plan or provider| Businesses and organisations that prefer more transparency and control, have a larger energy spend and the resources to build a relationship with a broker and manage periodic purchases of LGCs. Businesses and organisations that want to know which wind and solar farms they’re supporting| Medium sized businesses and organisations with more capacity and resources, a larger spend on energy, and desire to reduce the cost of LGCs and have greater budget certainty. Businesses and organisations that want to know which wind and solar farms they’re supporting
Benefits| Very easy and available from most electricity providers.Accredited, so no further effort required to be able to claim you’re 100% renewable| You can nominate the amount of GreenPower you want to buy and buy as little or as often as you want. Accredited, so no further effort required to be able to claim you’re 100% renewable| More control of who you buy from– which wind and solar farms you support. Can find the cheapest or preferred LGCs as needed. Keeps flexibility to choose preferred provider for electricity supply| Better pricing and budget certainty. LGC contracts are generally at fixed prices for 3-7 years. More control of who you buy from – which wind and solar farms you support. Can find the cheapest or preferred LGCs as needed. Keeps flexibility to choose preferred provider for electricity supply
Challenges| Potentially less negotiating power on cost of GreenPower. No transparent connectionto a particular wind or solar farm| Limited decoupled providers. Less price variety / competition. No transparent connection to a particular wind or solar farm| More effort to identify supplier and negotiate. Price may vary over time. It’s potentially cheaper or less risky to commit to longer term purchase. May require independent verification to beable to claim you’re reducing emissions or are 100% renewable| More effort to setup and negotiate. May require independent verification to be able to claim you’re reducing emissions or are 100% renewable. Risk of excess or shortfalls of LGCs
When to buy| When you’re revising or renegotiating your electricity contract, ideally at least 2 months prior to the contract end date| You can buy anytime, either in arrears or to cover future emissions| You can buy anytime, either in arrears or to cover future emissions| When you know your carbon emissions forecast and can buy for several years ahead. LGCs can either be purchased on the ‘spot’ market (paying today’s price for LGCs available now), or for several years ahead, which is usually for 3–7 years. This is known as buying in strips. The benefit of buying in strips is that you lock-in prices for future years or ‘vintages’ rather than taking a risk on that price increasing
Where to buy| Most electricity providers| Some electricity providers– when using the GreenPower website to find a provider, choose ‘event and decoupled’| Some electricity providers, energy consultants or brokers. They can also be purchased directly from wind or solar farms. This is typically only done by very large electricity users. For a list of energy consultants and brokers, visit businessrenewables.org.au/provider- profiles

Tips for buying Green Power and LGCs

Many companies switch to GreenPower with their existing electricity provider. We recommend you consider the following to ensure you maximise your purchasing power, receive competitive prices, and meet your goals.

The process outlined is the same for both smaller and larger organizations. Time frames will vary depending on the size and complexity of your business and your chosen purchasing method

Step 1 Research

Understand your current annual electricity use, tariffs, and costs. For some organizations, this may involve multiple locations or even different states.
Internal stakeholder engagement: Check in with key internal stakeholders and understand their drivers and any key issues.
Speak with the Business Renewables Centre Australia and organisations that have switched to GreenPower for tips and market updates. This is less necessary if you have a small business or organisation.
Start your business case. The following steps will enable you to add the required information to complete it. If you have a small business or organisation, you may not need to do this.

Time frame: One hour to 4 weeks

Step 2 Prepare

Choose your preferredpurchasing method

GreenPower electricity plan (coupled)

Research accredited GreenPower suppliers and create a short list.
If you care about overall company ethics, transparency in marketing and ending fossil fuel use as soon as possible, you might like to check out how electricity providers are ranked in the Green Electricity Guide, Australia’s only unbiased ranking of electricity retailers.
Compile information to give to short listed providers including sites, yearly consumption, and proposed start of new supply.

LGCs, including decoupled GreenPower

Research brokers, energy consultants and electricity providers and create a short list.
When searching for providers on the GreenPower site, choose ‘event and decoupled’ from the drop down list.
Compile information to give to short listed providers including sites, yearly consumption, and proposed start of new supply.
Websites like Zembl can also get quotes for you.

Time frame : One to 2 weeks

Step 3 Get quotes

Call electricity providers, energy consultants or brokers and provide information as required. Tell them when you’d like the quote.

Step 4 Finalise

Review and compare quotations. Consider the following:
- Pricing
- Term length, terms and conditions
- Project appeal (if you’re purchasing decoupled LGCs and a specific solar or wind farm is identified)
- location, type and any related environmental or community benefits identified
- Tenderers’ company values (where available) and whether they align with your own. For example, carbon neutral, modern slavery policy and so on
Select provider
Seek internal sign-off for recommended provider
Work with successful provider to change your electricity plan or finalise purchase of LGCs
Develop marketing and communications to celebrate your switch

Final tips

There is no better or worse buying option. Choose the renewable energy solution that suits your business or organization best.
Shop around to ensure you get a competitive offer.
Make sure you tell the world. Develop marketing and communications to celebrate your switch to renewables to build your brand with your clients, suppliers, and staff.