Green Energy Pricing Programs Are a Missed Opportunity

Using clean energy in the home is one way consumers feel they can contribute to combating global warming. Yet, few take advantage of the opportunity.

In an article for Energy Central, William Hughes, principal research analyst with Guidehouse Insights, says that less than 1% of American residences have signed up to participate in consumer green energy pricing programs.

“This is a missed opportunity for utilities to support their green energy initiatives and for customers who want to do what they can to support the environment,” Hughes said.

Although green energy pricing programs involve a price premium for the green power, data shows that the median price premium per kilowatt-hour for a residential customer to participate is $0.013, while the average price per kilowatt-hour in the US is $0.132 per the US Energy Information Administration (EIA). This is an increase of 10%, which for some, is a modest increase to a monthly bill.

In the article, Hughes highlights three main reasons consumers may not participate in these programs: many do not know if their utility offers a green energy pricing program, there is confusion as to what clean energy means, and some believe that green pricing is a deceptive shell game with no net benefit to society for participating in the program.

“Green energy pricing programs enable customers to take an active role in supporting the greening of not just the grid, but their grid,” Hughes said. “However, adequate merchandising and customer education about these programs where they are offered is missing. Besides the significant financial gain for utilities, such a move would engage and gratify many customers.”