Ad description
A leaflet for a wind energy project, which was distributed to properties in the village of Foston, stated "You are already enjoying lower energy costs from existing renewable energy developments, compared with the cost of energy from gas".
Issue
The complainant challenged whether the claim "You are already enjoying lower energy costs from existing renewable energy developments, compared with the cost of energy from gas" was misleading and could be substantiated.
Response
IEP Ltd said the claim was accurate as renewable energy was delivered to the generator at no financial cost and there were no residue disposal costs on the fuel. They said fossil and nuclear fuels were subject to purchase and residue disposal costs at global market rates. They noted that gas was the primary type of fossil fuel used for electricity generation in the UK, and as national reserves were running out, more gas was bought in at global prices, resulting in an increase in average wholesale prices. They said fossil fuel generators paid a levy for emitting greenhouse gas emissions.
They referenced the Committee for Climate Change report of December 2012, which they said showed that gas prices had increased household bills by 62% between 2004 and 2011, whereas low-carbon technologies had caused less than a 10% increase. They noted that Ofgem estimated average bills for gas, electricity and dual fuel customers and said at the end of 2013 the average dual fuel bill for customers on standard tariffs paying by direct debit rose by around 135% in nominal terms.
They said renewable energy increased in 2013 to provide around 15% of total power, two-thirds of which came from wind. They said the available figures did not provide a direct means of comparison between present household energy costs and what they would be without renewable energy, but they strongly indicated that energy coming from renewable sources was costing less than fossil fuelled and gas energy, and that bills were lower because of existing renewable energy projects.
IEP Ltd provided two press releases from Renewable Energy UK, a not for profit renewable energy trade association, that they said illustrated that renewable energy cost less than gas, and free energy sources cost less than purchased energy. They said there were temporary peaks and troughs in supply costs, but the overall trend was towards reduced costs from renewable energy.
Assessment
Upheld
The ASA considered consumers would understand from the broad claim "You are already enjoying lower energy costs from existing renewable energy developments, compared with the cost of energy from gas" that renewable energy developments had directly resulted in a reduction in cost of energy bills when compared to gas. While we noted the information IEP Ltd had supplied suggested that renewable energy could be cheaper than gas for consumers, we understood that a number of variable factors, such as changing gas prices, the scale of comparison and subsidies to energy bills, made it difficult to make a fair and accurate direct comparison, and considered that the claim was not sufficiently specific in this regard. We concluded that the claim had not been substantiated and was misleading.
The ad breached CAP Code (Edition 12) rules 3.1 3.1 Marketing communications must not materially mislead or be likely to do so. (Misleading advertising), 3.7 3.7 Before distributing or submitting a marketing communication for publication, marketers must hold documentary evidence to prove claims that consumers are likely to regard as objective and that are capable of objective substantiation. The ASA may regard claims as misleading in the absence of adequate substantiation. (Substantiation), 11.1 11.1 The basis of environmental claims must be clear. Unqualified claims could mislead if they omit significant information. 11.3 11.3 Absolute claims must be supported by a high level of substantiation. Comparative claims such as "greener" or "friendlier" can be justified, for example, if the advertised product provides a total environmental benefit over that of the marketer's previous product or competitor products and the basis of the comparison is clear. and 11.4 11.4 Marketers must base environmental claims on the full life cycle of the advertised product, unless the marketing communication states otherwise, and must make clear the limits of the life cycle. If a general claim cannot be justified, a more limited claim about specific aspects of a product might be justifiable. Marketers must ensure claims that are based on only part of the advertised product's life cycle do not mislead consumers about the product's total environmental impact. (Environmental claims).
Action
The ad must not appear again in its current form.
