Renewable Energy for Small Business : Understanding Your Options
For small businesses — renewable energy is becoming an important part of managing costs, reducing emissions and meeting customer expectations. You don’t need solar panels on your roof to switch to renewable energy. One of the simplest ways to reduce your carbon footprint is through your electricity retailer.
But the terminology can be confusing. Here’s what it means in practical terms.
1. Standard Grid Electricity
When you purchase a standard electricity plan, your power comes from the NSW electricity grid. The grid is a mix of:
- Coal-fired power stations
- Gas generation
- Renewable sources such as wind and solar
You cannot choose which electrons physically power your business, (electricity is pooled) but you can choose how your usage is accounted for. With a standard plan:
- You are paying for grid electricity
- Your emissions reflect the average NSW grid emissions factor
- No specific renewable allocation is attached to your account
This is typically the default option.
2. Carbon Neutral Electricity Plans
Some retailers offer “carbon neutral” electricity. In simple terms:
- Your electricity still comes from the standard grid mix
- The retailer purchases carbon offsets to compensate for the emissions associated with your usage
- Offsets may fund activities such as reforestation, methane capture or renewable projects.
Key considerations:
- You are not directly increasing renewable generation
- You are compensating for emissions after they occur
- The credibility depends on the quality of the offsets used
- This option reduces your reported carbon footprint but does not change the energy source itself.
3. 100% GreenPower (Certified Renewable Energy)
GreenPower is a government-accredited program. When you purchase a 100% GreenPower plan:
- Your retailer buys accredited renewable energy certificates on your behalf
- These certificates represent electricity generated from renewable sources such as wind and solar
- The renewable energy is fed into the grid, increasing the overall renewable share
You are still connected to the same physical grid, but your purchase ensures that an equivalent amount of certified renewable electricity is generated and added to the system.
Benefits:
- Direct support for renewable energy generation
- Credible, government-certified program
- Strong emissions reduction claim
For businesses wanting a clear and defensible renewable energy position, 100% GreenPower is often the most transparent retail option.
4. Partial GreenPower
You can also choose to purchase:
- 25% GreenPower
- 50% GreenPower
- 75% GreenPower
This allows businesses to transition progressively, balancing cost and ambition.
5. What About Gas?
Many businesses use gas for cooking or heating. Gas is a fossil fuel. While it may have lower emissions than coal-fired electricity, it still produces greenhouse gases when burned.
Retailers may offer:
- “Carbon neutral gas” (offsetting emissions through credits)
- Biomethane or renewable gas products (limited availability)
For businesses pursuing net zero, electrification (replacing gas equipment with high-efficiency electric alternatives powered by renewable electricity) is increasingly being considered.
Why This Matters for Small Business
Switching to renewable electricity can:
- Immediately reduce your Scope 2 emissions
- Strengthen your sustainability credentials
- Meet growing customer and supply chain expectations
- Support local and national renewable energy investment
Cost impacts vary. GreenPower typically carries a small premium, but for many small businesses the increase is modest relative to total operating costs and may be offset through energy efficiency improvements.
Start with Three Practical Steps
- Review your current electricity contract and confirm whether any renewable component is included.
- Ask your retailer for pricing on 100% GreenPower or partial GreenPower options.
- Compare the cost difference against your total annual energy spend — it may be less than expected.
Renewable energy procurement does not have to be complex. For most small businesses, it starts with a conversation with your retailer and a clear understanding of the options available.
If you would like guidance comparing renewable plans or understanding the emissions implications for your business, the Better Business Partnership team can help you navigate the next step toward cleaner energy.