Building an Unbundled REGO Sourcing Strategy

Purchasing Renewable Energy Guarantees of Origin (REGOs) through an electricity supply contract doesn't always provide a clear picture of where they come from. As expectations around transparency grow, more businesses are turning to unbundled REGOs for greater visibility and control. In this article, we explore the benefits of this approach and what businesses should consider when sourcing certificates separately.  

Why REGO transparency matters

REGO procurement is becoming an increasingly strategic consideration for businesses seeking to demonstrate credible renewable electricity consumption. While price remains an important factor, growing expectations from stakeholders are encouraging companies to place greater emphasis on the origin and traceability of their certificates.

In practice, this means considering not only the cost of REGOs, but also where and when the associated renewable electricity is generated. Businesses may benefit from aligning certificates more closely with their operational locations and consumption periods, while maintaining clear audit trails to support reporting and external claims.

Bundled versus unbundled REGOs

In the UK, REGOs fall under the broader category of Energy Attribute Certificates (EACs). These certificates provide information on the origin, ownership, generation year and generation technology, with each REGO representing 1MWh of electricity generated.

Businesses can procure REGOs through two approaches. Bundled REGOs are included in a renewable electricity supply contract, typically at an additional premium to cover consumption. Unbundled REGOs are purchased separately from a third party, independently of the electricity supply contract.

Benefits of buying unbundled REGOs

Buying REGOs separately from an electricity contract is a strategic decision that can offer several advantages for businesses, particularly when it comes to cost, flexibility and sustainability reporting:

Businesses can look beyond their incumbent electricity supplier and compare offers from multiple traders. This gives them access to more competitive pricing and helps improve cost effectiveness.

Greater flexibility allows companies to choose from energy sources such as wind, solar and hydro. They can also select locations that align with their corporate objectives and preferences.

Access to options that meet high sustainability standards helps businesses better fulfil their reporting requirements. This can support alignment with frameworks such as SBTi, CDP and RE100.

Planning your REGO purchases

Businesses can structure their purchases of unbundled REGOs around their expected electricity use, budgets and planning priorities, subject to the terms available from sellers.

Buying REGOs to cover part of forecast consumption, for example, 80 per cent, leaves room to adjust purchases once actual usage is confirmed. This reduces the risk of overbuying, although the remaining requirement will need to be purchased at the price available later.

Where sellers offer volume flexibility, businesses can agree a range within which purchases can change to reflect actual consumption. This can reduce the need for separate procurement exercises, provided any adjustments fall within the agreed limits.

Agreeing fixed prices for future REGO purchases can make budgeting easier and protect the contracted volume against price increases. The available contract length will depend on the seller, and businesses may miss out on savings if market prices fall.

What to consider when choosing REGOs

Businesses looking to strengthen their REGO procurement can consider where and when electricity is generated, which assets their certificates come from and whether those assets meet relevant reporting requirements.

Choosing REGOs from generators near their operations allows businesses to reflect local sourcing priorities in their purchases. Companies should be clear, however, that this identifies the certificates’ origin rather than the physical source of their electricity supply.

For closer alignment with electricity use, businesses can explore hourly or half-hourly matching. This requires reliable generation and consumption data for the same periods, alongside certificates that support the claim; standard REGOs alone do not establish that match.

Specifying the renewable assets behind their REGOs gives businesses clearer information about the generation associated with their purchases. This can support transparent reporting, although selecting a named asset does not itself demonstrate direct investment or new renewable capacity.

Asset age is also relevant, particularly for businesses with RE100 commitments. Companies should check commissioning or repowering dates against the requirements that apply to their purchases, including any exemptions, rather than assuming all certificates from newer assets automatically qualify.

Proposed changes to GHG Protocol standards

Proposed Greenhouse Gas (GHG) Protocol changes could affect where businesses buy their renewable electricity certificates. The UK would remain one market, but companies operating in Europe and North America may need to buy within national or regional electricity grids.

Businesses may also need to match certificates to the hours they use electricity, with requirements potentially applying above 5,000–10,000 MWh. While UK options are still developing, planning ahead could help prepare for changes anticipated in 2028.

How Big Energy Group can help

Big Energy Group’s team can support clients in developing a bespoke REGO and broader EAC strategy, alongside purchasing certificates from trusted global traders. If you would like to explore EAC purchasing options for your next reporting period, please contact Shane Lightfoot at shane.lightfoot@bigenergygroup.co.uk.

About Big Energy Group

Big Energy Group is a privately held, British-owned energy brokerage with an established track record of helping clients successfully navigate the energy market. The company has offices in Harrogate and the Tees Valley and serves more than 500 businesses across the UK. For more information, please visit bigenergygroup.co.uk.