Advertisment
The “About Us” section of the website included the following statement:
“Who we are
At SSE Airtricity, we provide 100% green electricity*, natural gas and essential services to homes and businesses across Ireland.”
Linked footnote stated:
“*162,000 tonnes of quoted CO2 emissions abated based on Average CO2 Emissions (g/kWh) in the All-Island Single Electricity Market and published by UR in its 2019 Fuel Mix Disclosure and CO2 Emissions Report, published September 2020.”
The “About our fuel sources” website stated:
“SSE Airtricity – Proud to be Ireland’s largest provider of 100% green energy.”
“At SSE Airtricity we’re proud to be Ireland’s largest provider of 100% green energy^.
In 2020, all of the electricity we supplied to our home and business customers was from renewable energy sourced by SSE Airtricity, abating over 131,000 tonnes of harmful CO2 emissions every month.^^
As well as supplying 100% green energy to more Irish homes and businesses than any other supplier, we’re also proud to be the largest generator of wind power in Ireland. SSE’s operational portfolio of 28 onshore wind farms has a combined generation capacity of over 700MW, making SSE the largest generator and provider of renewable energy in the all-island Single Electricity Market. This portfolio includes the 174MW Galway Wind Park, Ireland’s largest wind farm which is co-owned with Greencoat Renewables.
Together, we can power the change to a greener Ireland.”
Linked footnote stated:
“^Largest provider of 100% green energy supplied to homes and businesses based on Electricity Market Share by total tWh, published by the Commission for Regulation of Utilities (CRU) in most recent Annual Energy and Water Monitoring Report for 2020, published in November 2021.
^^Quoted CO2 emissions abated based on Average CO2 Emissions (t/MWh) in 2020 in the All-Island Single Electricity Market, and published by the CRU in its Fuel Mix Disclosure and CO2 Emissions for 2020, published October 2021
The page included a table titled “SSE Airtricity Fuel Mix Disclosure: January 2020 to December 2020”.
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| Electricity supplied has been sourced from the following fuels | Electricity supplied by SSE Airtricity | Average for all island market (for comparison) |
|---|
| Renewable | 100% | 57.9% |
| Natural Gas | 0% | 35.8% |
| Coal | 0% | 3.0% |
| Peat | 0% | 2.1% |
| Other | 0% | 1.2% |
| Nuclear | 0% | 0% |
| Oil | 0% | 0% |
| EU Fossil | 0% | 0% |
| Total | 100% | 100% |
Complaint
Three complaints were received regarding the advertising. All complainants objected to the advertising on the grounds that the claim to provide 100% green energy to homes and businesses was misleading given that all suppliers purchased the energy supplied to their customers’ homes and businesses from a single energy market that was made up of a mix of both renewable (green) and non-renewable (fossil fuel) sources, therefore, it was not possible to say that their customers received 100% green energy.
One complainant referred to an answer on Twitter by the advertisers and another referred to a direct response they received from the advertisers which stated that the advertisers sourced the electricity provided to their customers from a single market.
Response
The advertisers said that they were fully compliant with all their obligations regarding marketing material and their position supplying 100% green energy, as verified independently by the industry regulator. They said that all energy suppliers operated in an actively regulated market in the Republic of Ireland, as such, electricity and gas suppliers were required to comply with the obligations of their supply licence when conducting their electricity and gas supply business, including adhering to obligations mandated upon suppliers by the Commission for Regulation of Utilities (CRU) relating to such matters which included how they market to customers.
They said that their claim to supply 100% renewable energy was substantiated by the latest information note on Fuel Mix Disclosure and CO2 Emissions for 2020, published by the Commission for Regulation of Utilities (CR) in October 2021*1 which was the most up to date independent verification on each supplier’s fuel mix in the electricity market and confirmed that 100% of the energy they supplied to their electricity customers in Ireland was from renewable sources.
The advertisers said that they were proud to provide 100% green energy to Irish home and business customers and asserted that all of the electricity supplied to their home and business customers was from renewable energy sources, such as their own 28 onshore windfarms across the island of Ireland, significantly abating over 131,000 tonnes of harmful CO2 emissions from the island of Ireland every month.
They referred to page six of the CRU’s Fuel Mix Disclosure 2020*2 which stated that the Fuel Mix Disclosure calculation was the only way of independently verifying the source of electricity that suppliers claim to provide to their consumers, consequently enabling consumers to choose a company which was supplying low carbon-intensive energy or even zero emissions. They said that they were proud to be independently verified by the Regulator in this way and were also proud to reflect this in their promotional and marketing materials.
They referred to the fact that a Fuel Mix Disclosure (FMD) was required by Article 3(9) of Directive 2009/72/EC*3 and that the transposing legislation in Ireland, S.I. number 60 of 2005*4, required the Commission for Regulation of Utilities (CRU) to ensure that electricity suppliers provide reliable fuel mix information on all bills and promotional materials issued to customers, and all suppliers are required to adhere to these obligations. They said that the information to be included was the contribution of each energy source to the overall fuel mix of each supplier and the associated environmental impacts in the preceding year. They said that they were satisfied that they were compliant with their obligations in this regard in the production of customer bills and in their promotional and marketing materials, including their website.
The advertisers stated that they were not the operator of Ireland’s transmission/distribution systems, and none of their marketing material had suggested or claimed otherwise. They said that electricity was a homogenised commodity, and it was impossible to trace individual electrons from point of physical production to point of physical consumption. They said that what it was possible for suppliers to demonstrate, and for an independent Calculating Body to verify (in Ireland’s case, the Commission for the Regulation of Utilities under Regulation 25 of S.I. No. 60 of 2005, which transposes Article 3(6) of the Electricity Directive (2003/54/EC)), was where a supplier’s underlying electricity was sourced from. They said that by contracting a volume of renewable electricity from generators equivalent to the demand of its customers, they were proud to provide 100% green energy to Irish home and business customers and to verify that these claims were accurate, a robust Fuel Mix Disclosure Methodology had been established by the Regulatory Authorities (CRU in the Republic of Ireland).
In response to the information provided to the complainants via Twitter and by direct correspondence, the advertisers said that the complainants were conflating issues with how Ireland’s wholesale energy market operated against how suppliers verified their fuel sources. They considered that the information provided via Twitter and in direct response were in response to a question regarding how the cost of natural gas on wholesale energy markets impacted suppliers who were 100% green and to a question regarding a price change they had made. They said that currently, there was one wholesale marketplace for buying energy on the Island of Ireland, the Single Electricity Market (SEM) and it was the sole marketplace where all generators and suppliers traded power. They said that the market operated on a day ahead basis, where generators and suppliers bid into this market with a price at which they were happy to buy or sell electricity for each half hour of the following day. Based on these bids, the Single Electricity Market Operator (SEMO) would determine a System Marginal Price (SMP) for each half-hour. They said that each generator competed in an auction for each timeslot to say they could supply X amount of energy to meet that demand at X price and the cheapest generators were selected to meet the demand needed and those who were too expensive were not switched on and received no revenue from the market. They said that all generators who were successful in these half hourly auctions were paid the same price, and this price was set by the last generator needed to meet demand (i.e. the most expensive of those needed). They said that the system would always go for the cheapest, most efficient energy to meet demand first – almost always wind/renewables, however, the remaining energy needed to meet the total national demand must then come from somewhere else, and it was the final generator needed who set the price in that half hour, with all generators (including renewables) being paid this rate. They said that by selecting the cheapest form of energy to meet demand first, the market tries to apply downward pressure on generators to reduce their cost of production. They said that all generators were paid the same rate, but if you were too expensive, you would miss out on the auction and that this was how the wholesale price impacted all energy suppliers, regardless of their fuel mix. However, they said that it did not dictate which energy source suppliers opt for in their fuel mix. They said that they met all their electricity demand through securing energy generated by 100% renewable sources which were independently verified annually through robust Fuel Mix Disclosure by the CRU and as stated previously, was substantiated by the latest information note on Fuel Mix Disclosure for 2020.
They said that as a responsible company, who were happy to engage with questions from their customers, the media and the public, they would always do their best to explain how complex the systems and mechanisms within the energy market can often be. They acknowledged the complexity of the market, however they were not responsible for how the Single Electricity Market was operated and that they were required, like all other suppliers, to participate in the single market and it was the single marketplace for energy trading on the island of Ireland.
They said that as previously outlined, the mechanisms by which the Single Electricity Market set the price for wholesale costs, did not dictate what energy generator or energy source a supplier chose to purchase their energy from, as the matter of how energy was sourced versus how energy was priced were two separate matters within the one market.
The advertisers said that the annual Fuel Mix Disclosure was specifically related to electricity supply and at no point had they ever denied supplied natural gas as a source of energy, however, it was not part of their electricity fuel mix and was a separate fuel which was supplied through Ireland’s gas network infrastructure.
They considered that their webpage regarding their fuel sources had specifically clarified that their 100% green energy status related purely to electricity as it had specifically stated that it applied to electricity in the table provided.
*1 https://www.cru.ie/document_group/fuel-mix-and-co2-emissions-disclosure-2/
*2 https://www.cru.ie/wp-content/uploads/2021/11/CRU21118-Fuel-Mix-Disclosure-and-Emissions-2020-Information-Paper-V.2.1.pdf
*3 https://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2009:211:0055:0093:EN:PDF
*4 https://www.irishstatutebook.ie/eli/2005/si/60/made/en/print#:~:text=No.-,60%20of%202005%20.,MARKET%20IN%20ELECTRICITY)%20REGULATIONS%202005.&text=Citation%20and%20Construction-,1.,Market%20in%20Electricity)%20Regulations%202005.
FURTHER INFORMATION:
The Executive sought a view from the Commission for the Regulation of Utilities (CRU) on the claim “100% Green Energy” when energy provided to consumers came from a pooled grid that included both renewable and non-renewable energy. The CRU provided a statement in response.
They stated that EU Renewables Directive and Irish legislation allowed the use of guarantees of origin (GOs) for fuel mix disclosure for the purposes of demonstrating to final customers the share or quantity of energy from renewable sources in an electricity supplier’s energy mix and in the electricity supplied to consumers.
They said that they recognised the importance of maintaining confidence in the Guarantees of Origin process, and rigorously oversaw the application of the CRU’s verification process and reporting of this data in line with EU legislation to ensure the validity and accuracy of what information consumers receive.
The said that they published Fuel Mix Disclosure information every year to provide consumers with the information necessary to distinguish between electricity supply companies based on their individual fuel mix and emissions associated with their supplied electricity and it was the method of independently verifying the source of electricity that suppliers claim to provide to their consumers.
They said that all suppliers with retail customers were required to submit a fuel mix declaration to SEMO (Single Electricity Market Operator*5) so that a representative fuel mix could be calculated and disclosed and that suppliers were also obliged under the terms of their licenses to present Fuel Mix Disclosure data on their bills and promotional materials.
The CRU said that the Renewables Directive was explicit in restricting the double-counting of GOs and a given GO could only be used once and any one MWh of renewable energy produced could only be issued as one GO certificate.
They said that the SEMO issued and cancelled GOs in accordance with the CRU’s “Supervisory Framework for Administration of Guarantees of Origin” and that the GO certificates were precisely defined tracking instruments of the European Commission and were only traded between European countries, and solely accounted for through a European trading hub (i.e., the Association of Issuing Bodies). They said that imported GOs must adhere to EU-wide standards as set by this hub, which tracked certificates traded between countries, ensuring that double-counting did not take place.
They said that suppliers’ fuel mix information referred not only to green electricity physically produced in Ireland, but also to the verified green electricity that could be sourced from other European countries through Guarantee of Origin (GO) Certificates. They said that Irish electricity suppliers could purchase GOs to use as proof of the share or quantity of their energy demand from renewable sources in Europe and allowed suppliers to purchase the renewable benefit of certain generators across Europe and include it in their total fuel mix. They said that this meant that the fuel mix shown by suppliers could have a higher percentage share of renewable energy sources than existed in the actual physical generation distributed to end customers via the grid in Ireland.
They said that they considered that the supervisory framework and the CRU’s verification process for green products were robust enough to provide adequate assurances of the validity of Guarantees of Origin and reliable fuel mix disclosures by suppliers for their electricity customers. Finally, they provided links to the following documents:
• CRU’s verification process for green products*6
• CRU’s “Supervisory Framework for Administration of Guarantees of Origin*7
• CRU’s annual Fuel Mix Disclosure publications*8
Following further consultation by the ASAI Executive, the CRU said that the current disclosure of the consumed product mix and supplier fuel mix is slightly confusing to the end electricity consumers in Ireland and that they recognised that the increased information would be beneficial to customers. On foot of a proposal by the ASAI Executive to explore developing advertising guidance in this area, they indicated that they would be happy to engage with the ASAI and the utility providers on the ASAI Executive’s initiative.
*5 https://www.sem-o.com/about/
*6 https://www.cru.ie/wp-content/uploads/2015/07/CER15205-Green-Source-Products-Decision-Paper.pdf
*7 https://www.cru.ie/wp-content/uploads/2011/07/cer11824.pdf
*8 https://www.cru.ie/document_group/fuel-mix-and-co2-emissions-disclosure-2/
Conclusion
Complaints Upheld:
The Complaints Committee considered the detail of the complaint and the advertisers’ response together with the information provided by the CRU.
The Complaints Committee were aware of the importance for society of the climate change agenda, including the switch from fossil fuel to renewables. They generally understood that there was one electricity grid in Ireland into which generated electricity was transmitted for distribution to end users. Further, electricity generated by different means was not differentiated once it was transmitted to the grid, i.e., it is then a homogenous product.
The Complaints Committee noted the information on the construction of the Single Electricity Market. They also noted the EU and national legislation in place underpinning the market. They considered that information for consumers could be improved, and that significant care was needed in the creation of advertising messages so as not to exaggerate what could be delivered to individual premises. The Committee considered that there would be significant benefit for consumers were guidance to be developed for the energy utilities on advertising claims and welcomed that the ASAI and the CRU would be addressing this matter.
The Committee noted the advertising claims which stated “…we provide 100% green electricity* … to homes and businesses across Ireland” which had been linked to a footnote qualifying the statement by reference to the CRU’s Fuel Mix Disclosure for 2019; “… all of the electricity we supplied to our home and business customers was from renewable energy sourced by SSE Airtricity, abating over 131,000 tonnes of harmful CO2 emissions every month^^” and “As well as supplying 100% green energy to more Irish homes and businesses than any other supplier, we’re also proud to be the largest generator of wind power in Ireland”.
Electricity which was provided to end users’ premises from the national grid was comprised of electricity generated from a mix of fuel sources, both non-renewable sources and renewable energy. These objective factors were incompatible with advertising claims that the electricity delivered to end users’ premises was 100% green electricity. In the circumstances, the Committee considered that references in an advertising claim to supply “to our home and business customers” which was related to renewable or green energy had the potential to mislead and therefore in breach of Sections 4.1, 4.4, 4.9, 4.10, 15.2 and 15.5 of the Code.
ACTION REQUIRED:
Given the need for guidance in the area, the Committee determined that, going forward, the advertising should not reappear in its current form and they noted that the ASAI and the CRU were addressing the requirement for guidance in the area.
