Carbon neutral vs GreenPower

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GreenPower vs carbon neutral electricity

Can’t decide between GreenPower and carbon neutral? Here’s a quick comparison of the two.

General guide only

GreenPower is a government-run program in Australia that allows consumers to support renewable energy generation.

On the other hand, carbon neutral energy is a program where your power provider offsets the grid energy you use with emissions reduction certificates that support sustainability projects.

The main differences between GreenPower and carbon neutral energy are:

• Carbon-neutral programs support projects that remove greenhouse gases from the atmosphere (i.e. reforestation). Conversely, Greenpower finances local, renewable generators, feeding renewable energy back into the grid.
• GreenPower supports Australia-based initiatives, while carbon offsets can be global in scale.
• For carbon neutral energy, your energy providers pay to support sustainability projects on your behalf, while GreenPower typically incurs an extra fee.

GreenPower explained

What is GreenPower?

GreenPower is a government-led initiative whereby energy retailers agree to offset some or all of customers’ power usage by funding accredited renewable generators.

Depending on the retailer, you can opt to add the cost of GreenPower to your plan, equal to anything from 10% to 100% of your electricity usage..

For example, if your current energy usage rate is 25c/kWh, adding 50% GreenPower could bump it up to 30c/kWh. In exchange, the equivalent of half of your power usage will be offset by the creation of renewable energy.

What does GreenPower support?

GreenPower supports over 400 renewable generators in Australia. The capacity of these generators varies greatly, with some at 0.1MW and others exceeding 500MW.

Renewable sources include:

• Wind: Wind farms convert wind energy into electricity.
• Solar: Solar farms capture sunlight and convert it into electricity.
• Hydro: Hydropower plants use the energy of moving water to generate electricity.
• Bioenergy: Biogas plants use organic matter to create electricity.

You can find the exact list of accredited programs on the GreenPower website.

Some of the largest projects the GreenPower program supports are the Stockyard Hill Wind Farm and Coopers Gap Wind Farm.

Is GreenPower good for the environment?

Aside from going completely off-grid, GreenPower is the most sustainable way for normal residential customers to use energy. 

If your household uses a lot of power, you’ll have peace of mind knowing that money is being invested into the generation of renewable energy equalling your surplus usage.

Which providers offer GreenPower?

In Australia, there are over 25 energy providers currently offering GreenPower options to residential customers.

• ActewAGL Greenchoice
• AGL Green Energy
• Amber GreenPower
• CovaU GreenPower
• Diamond Pure Plus
• Discover GreenPower
• Dodo GreenPower
• Energy Locals GreenPower
• EnergyAustralia PureEnergy
• Engie GreenPower
• Ergon Energy Clean Energy
• Flow Power GreenPower
• GloBird Energy Green
• Lumo GreenPower
• Microgrid Power GreenPower
• Momentum GreenPower
• Nectr GreenPower
• Origin GreenPower
• OVO Energy GreenPower
• Pacific Blue GreenPower
• Powershop Australia GreenPower
• Red Energy Essential Green
• Rimfire Energy Green
• Synergy NaturalPower
• Tango Energy Blue
• WINconnect GreenPower

How much does GreenPower cost?

GreenPower is a little more expensive than standard electricity, costing around five to 10 cents more per kilowatt hour (kWh) depending on the retailer.

Hypothetically, if a household uses 400kWh of power in a month at a rate of 20c/kWh, the usage part of the power bill for that month will be around $80. With an extra 5c/kWh for GreenPower, they would pay $100.

If you’re worried about your bills blowing out, you may elect to only have a portion of your bill offset with GreenPower. Customers who opt for low levels of GreenPower, say 10% or 20% of their usage, may pay a fixed fee of $1 or $2 per week.

How can I get GreenPower?

Signing up for GreenPower is straightforward. Either call your retailer and ask for it to be added to your energy plan or choose a plan that has GreenPower integrated into it already.

Below are some of the plans on our database that offer green energy options. The cost and percentage of GreenPower may vary across each plan.

Carbon neutral electricity explained

What is carbon neutral electricity?

Carbon neutral energy means that your power usage is offset by your retailer supporting certified sustainability projects that reduce carbon emissions.

These projects sell emissions reductions/units certificates to companies that are interested in being carbon neutral in order to fund their continuation.

Retailers have a choice of which initiatives they support, which can include anything from waste management to reforestation.

What does carbon neutral electricity support?

Thousands of climate action projects around the world sell carbon offset units to Australian energy retailers.

Here are examples of carbon emission reduction projects the biggest retailers (such as  AGL and Origin ) are supporting through their carbon offset programs:

• Fire management in Australia that prevents large bushfires
• Landfill waste management program minimising greenhouse gases escaping.
• Planting trees or forest regeneration to absorb carbon dioxide in the atmosphere.
• Energy efficiency programs to promote power-saving LED light bulbs and water-saving shower heads.
• Investment in renewable energy generators such as solar and wind farms.

Are carbon neutral programs good for the environment?

In general, yes. While these initiatives aren’t always specifically reducing Australian carbon emissions, they’re creating a net positive impact.

So, it’s still better to be on an energy plan that supports carbon neutral initiatives than not to be, especially if GreenPower is out of your financial reach.

Which providers offer carbon neutral electricity?

Here are some of the providers in Australia that offer to offset customers’ usage with the purchase of carbon credits.

While most retailers offer this service by default, not all do. Check with your preferred provider to make sure you’re definitely getting it. Here are a handful of current examples:

• AGL
• Alinta Energy
• Amber
• Arcline by RACV
• Energy Locals
• Engie
• GloBird Energy
• Nectr
• Origin Energy
• Powershop.

How much does carbon neutral electricity cost?

For the most part, energy companies don’t charge ‘extra’ for carbon neutrality. However, there are exceptions:

• AGL requires customers to pay $1 a week for electricity, or 50c per week for gas, for its opt-in initiative that uses emissions reduction projects to offset a home’s carbon emissions.
• Origin LPG customers can also expect to pay $3 extra per 45kg cylinder (or tanker-fill equivalent) for Green LPG or about $1.50 per week for its Go Zero programs for electricity customers.

While you might get the impression that you’re getting carbon neutral energy offsets for free with some retailers, the reality is you’ll be financing it through the usage and supply charges on your energy plan.

How can I get carbon electricity energy?

Some energy providers require you to opt in for carbon offset initiatives. However, most of the companies below will offer the solution by default.

Here are some plans on our database that come from retailers with carbon-neutral programs.

Should I choose carbon neutral electricity or GreenPower?

How far you go with your sustainable living efforts is up to you.

GreenPower will have a bigger impact on Australia’s carbon emissions than carbon neutral programs, but it will also have a bigger impact on your wallet.

For those who can afford to chuck some extra change on the table for GreenPower, it’s probably the superior option. But if you can’t, an energy plan with carbon neutral inclusions is your next best bet.

We recommend comparing energy plans from a range of carbon neutral providers, GreenPower providers and others with our energy comparison tool.