Ways a business can use renewable energy
On-site solar, green tariffs, REGOs and PPAs compared
| What it is | Effect on the bill | In carbon reporting | |
|---|---|---|---|
| On-site solar | Panels on your roof or land, used on site | Cuts what you buy; exports can earn an export payment | Reduces electricity purchased |
| Green tariff | A supply contract where the supplier matches your use with renewable sources, typically through REGOs | No saving from the tariff itself | Shown as a market-based figure alongside the location-based one |
| REGOs bought separately | Certificates, one per MWh of renewable output | A cost, not a saving | Market-based figure |
| On-site PPA | A provider owns panels on your site and sells you the power | Pay an agreed rate per kWh | Renewable power supplied directly on site |
| Off-site (corporate) PPA | A contract for power from a solar or wind farm elsewhere | Depends on the contract | Market-based figure |
On-site solar
On-site solar is the only option on this list that reduces the electricity you have to buy. What you use as it is made saves your full unit price; what you export can earn a Smart Export Guarantee payment, at rates set by suppliers (Ofgem).
It needs a suitable roof or land, the right daytime use and capital (or a PPA). See how much solar your business needs and commercial solar payback.
Green tariffs and REGO certificates
Ofgem runs the REGO scheme (Ofgem):
- One certificate per MWh: Ofgem issues one REGO per megawatt hour of eligible renewable output to renewable generators.
- What they are for: Their primary use is Fuel Mix Disclosure: licensed suppliers must tell customers the mix of fuels behind the electricity they supply.
- Who can get them: Renewable generating stations in Great Britain and Northern Ireland, through the renewable electricity register.
- Europe: The EU stopped recognising UK REGOs from 1 January 2021, and EU Guarantees of Origin are no longer used for GB Fuel Mix Disclosure from the period starting 1 April 2023.
A green tariff is a way of buying power with renewable certificates attached. It is quick to arrange and needs no roof, but it doesn't change your consumption or, by itself, your price.
Which counts for carbon reporting
The UK Government's Environmental Reporting Guidelines (the guidance for Streamlined Energy and Carbon Reporting) say (guidance, "Reporting renewable energy"):
- Location-based first: Organisations are encouraged to report electricity emissions using location-based grid-average factors, and hour-by-hour factors where available.
- Market-based alongside: Where an organisation has contracts for renewable electricity, such as PPAs or separately bought REGOs, it can show a reduced, market-based figure, presented alongside the location-based figure.
- Say what it is: Organisations should specify whether the renewable energy is additional, subsidised, and supplied directly (including on-site generation) or through a third party.
The guidance's example report lists "renewable electricity generated from owned or controlled sources" separately from "electricity purchased for own use". Power your own panels make and you use simply never becomes purchased electricity. Reporting rules are set out on GOV.UK; your accountant or sustainability adviser will know which apply to you.
PPAs: on-site and off-site
An on-site PPA puts panels on your premises with no capital outlay: a provider finances, installs and maintains them and you buy the power, usually for 10 to 25 years (Solar Energy UK). An off-site, or corporate, PPA is a contract for power from a solar or wind farm elsewhere, usually for large users. See solar PPAs for businesses.
Net zero plans: where solar fits
Most business energy plans follow the same order:
- Use less: Lighting, heating controls, insulation, switching things off.
- Generate your own: Solar on the roof or land, sized to the daytime use that is left.
- Buy the rest renewable: A green tariff or PPA for what solar can't cover, reported on the basis the guidance sets out.
On-site solar is the step that makes a measurable difference to both cost and purchased electricity, which is why it usually comes before buying certificates. The first step to finding out what your site can do is a survey.
Note: General information, not reporting advice. Check with your adviser which reporting rules apply to your organisation.
Sources
Ofgem, GOV.UK (Environmental Reporting Guidelines, March 2019; page last updated 29 March 2019) and Solar Energy UK pages read on 2 November 2026.
- Ofgem: Renewable Energy Guarantees of Origin (REGO)
- GOV.UK (Defra/BEIS): Environmental Reporting Guidelines, including SECR guidance (March 2019), 'Reporting renewable energy'
- GOV.UK: Environmental reporting guidelines including Streamlined Energy and Carbon Reporting
- Solar Energy UK: Power purchase agreements
- Ofgem: Smart Export Guarantee
Frequently asked questions
What is the best renewable energy for a business?
For most businesses with a suitable roof or land and daytime electricity use, on-site solar is the one option that both cuts the electricity bill and cuts the electricity bought from the grid. A green tariff changes where the power you buy is said to come from, but not how much you pay or use.
What is a REGO certificate?
A Renewable Energy Guarantee of Origin. Ofgem issues one REGO per megawatt hour of eligible renewable output to generators. Their main use in Great Britain and Northern Ireland is Fuel Mix Disclosure, where licensed suppliers tell customers the mix of fuels behind the electricity they supply.
Does a green tariff count towards carbon reporting?
Under the UK Government's environmental reporting guidance, renewable electricity bought through contracts such as PPAs or REGOs can be shown using a market-based figure, presented alongside the location-based grid-average figure. The guidance asks organisations to say whether the renewable energy is additional and how it is supplied.
Does on-site solar reduce my business's carbon emissions?
Electricity your panels make and you use on site is electricity you don't buy from the grid, so it doesn't appear in your purchased electricity at all. The guidance's example report lists renewable electricity generated on site separately from electricity purchased.
Can my business get REGOs for its own solar panels?
Ofgem says generating stations in Great Britain and Northern Ireland that produce electricity from eligible renewable sources can apply for accreditation through the renewable electricity register. One REGO is issued per megawatt hour, so it is worth asking about only for larger systems.
Related pages
- Solar and carbon reportingHow on-site solar affects Scope 2 emissions, location-based and market-based reporting, SECR, carbon reduction plans, supplier questionnaires and REGOs, in plain terms.
Power purchase agreementsHow on-site solar PPAs work, typical contract lengths, how prices rise over time, what happens if you sell or move, and the clauses to check before signing.
Battery storageWhen a commercial battery pays: storing surplus solar, time of use tariffs, peak shaving, sizing from half-hourly data, illustrative costs, safety and siting.- Cutting energy costsStart with what you pay and when, cut waste and inefficiency, then generate your own: the order that gives the best return.