A circular for Eneco UK and Co-operative Energy, received between 14 and 17 May 2016, promoted their jointly supplied “Highlands & Mearns Wind” energy tariff. Text on the front page stated “Introducing Highlands & Mearns Wind - a new energy tariff that allows you to power your home using the electricity generated by your local wind farm!”. Further text inside the circular stated “The tariff … will provide you with 100% green electricity that is generated by your local Lochluichart Wind Farm” and “Electricity tariff. Locally sourced 100% green electricity”. Under the heading “Let’s meet up”, text included “We will also be offering you the opportunity to visit your local wind farm to learn more about where the Highlands & Mearns Wind electricity comes from”.
Six complainants, who understood that customers who signed up to the Highlands & Mearns Wind tariff would be supplied electricity via the National Grid, challenged whether the ad misleadingly implied that the electricity would be supplied from the Lochluichart Wind Farm.
Eneco UK Ltd and Co-operative Energy responded jointly. They explained that the tariff was established as the result of a partnership between Eneco UK in its capacity as a renewable energy generator and Co-operative Energy as an energy supplier, in response to community requests to receive energy from their local wind farm.
Co-operative Energy had agreed to procure a defined amount of energy each month for the duration of the tariff period. That amount had been set at a level which exceeded the amount of energy that would be supplied to customers who signed up to the tariff. The agreement committed Co-operative Energy to purchase an equivalent amount of Renewable Energy Guarantee of Origin (REGO) certificates generated by Eneco UK’s Highlands and Mearns Wind wind farms. Both the energy supplied by Eneco UK and the REGOs generated from those wind farms would be ring-fenced by Co-operative Energy and allocated specifically against 100% of the energy supplied to the customers on the Highlands & Mearns Wind tariff. Each MWh of energy supplied to customers on the tariff could be supported by a date-stamped REGO from the relevant wind farm and could therefore be described as 100% green.
Eneco UK and Co-operative Energy said the circular was intended to provide recipients with information as to where they could find out more about the details of the tariff and the process of the supply of energy, and formed part of a wider marketing plan. The wording used in the circular did not, and was not intended to, describe the delivery mechanism of the energy. Rather, it was intended to assure recipients that those on the tariff would have their energy usage assigned to their local Eneco wind farm. Further information about the tariff and the delivery of the energy could be found on the Highlands & Mearns Wind websites, the URL of which was stated in the circular. The circular also invited recipients to email or call to register interest in upcoming local events about Highlands & Mearns Wind.
The ad provided information about the Highlands & Mearns Wind energy tariff and included claims that the tariff would provide customers with 100% green electricity generated by their local wind farm, but did not detail the process by which the energy used by customers would be offset in its entirety by energy generated by the Lochluichart Wind Farm. The ASA considered that some consumers might not be aware that the vast majority of power generated by both renewable and non-renewable sources was sent to and distributed via the National Grid, or that renewable energy tariffs operated through offsetting the electricity supplied to the customer via the National Grid against electricity purchased from renewable sources. We considered those consumers might, as a result, interpret the ad’s claims to mean that the electricity delivered to their home would be sourced directly from the Lochluichart Wind Farm.
We considered the key consideration for consumers when deciding if they should respond to the ad would be whether or not they wished to switch from their current tariff (which might provide electricity generated from non-renewable sources, renewable sources, or a mixture of both) to one on which it would be generated from local renewable sources, rather than whether the electricity would be directly delivered from the Lochluichart Wind Farm to their home. We further considered that, because it was generally not possible for renewable energy to be supplied directly from the power source to the consumer, and because purchasing from a renewable energy supplier added to the total renewable energy supplied through the National Grid, any consumers who responded to the ad in the mistaken understanding that they would be supplied directly from Lochluichart Wind Farm would be unlikely to be disadvantaged. We also considered they would have been unlikely to take a decision to not sign up to the Highlands & Mearns Wind tariff had they been aware of how energy was supplied and distributed through the National Grid.
We understood that all the electricity used by customers on the Highlands & Mearns Wind tariff would be accounted for by electricity generated by the Lochluichart Wind Farm. We therefore considered that recipients of the ad who wanted to reduce the environmental impact of their energy consumption, and do so by using locally generated renewable energy, could achieve that by switching to the Highlands & Mearns Wind tariff, even though their electricity was delivered to them via the National Grid. We therefore concluded the ad was not misleading.
We investigated the ad under CAP Code (Edition 12) rules
Marketing communications must not materially mislead or be likely to do so.
Marketing communications must not mislead the consumer by omitting material information. They must not mislead by hiding material information or presenting it in an unclear, unintelligible, ambiguous or untimely manner.
Material information is information that the consumer needs to make informed decisions in relation to a product. Whether the omission or presentation of material information is likely to mislead the consumer depends on the context, the medium and, if the medium of the marketing communication is constrained by time or space, the measures that the marketer takes to make that information available to the consumer by other means. (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) and 11.1 11.1 The basis of environmental claims must be clear. Unqualified claims could mislead if they omit significant information. (Environmental Claims), but did not find it in breach.
No further action necessary.