On February 16, Italy will celebrate the National Day of Energy Saving and Sustainable Lifestyles. For many companies, this occasion is an opportunity to reflect on how to turn their climate commitment into concrete action.
One of the most immediate and effective levers is the choice of electricity supply contract. Switching to an offer that guarantees renewable origin can significantly reduce the emissions associated with your company’s energy consumption. But how do these contracts really work? What certification mechanisms make them reliable? And above all, why are they a strategic lever for corporate decarbonization?
What renewable energy contracts are
In the Italian market, virtually all major electricity suppliers now offer “green plans" or “green tariffs” alongside standard supplies.
The defining feature of these contracts is the guarantee that an amount of electricity equivalent to all or part of your consumption has been produced from renewable sources (solar, wind, hydropower, biomass) and injected into the grid.
For many companies, switching to a green offer is one of the fastest and most tangible actions to start reducing their environmental impact. Unlike structural measures such as installing photovoltaic systems or upgrading building energy performance—which require significant investment and long lead times—changing supplier or renegotiating an existing contract can be done quickly, often without any major additional cost.
How to check whether you’re already using renewable energy: read your bill
Before considering a switch to a green electricity offer, the first step is to understand where the energy you purchase today actually comes from.
By law, every electricity bill includes a section dedicated to the “energy mix,” showing the sources used to generate the supplied electricity: fossil fuels (gas, coal) and renewable sources (solar, wind, hydropower, biomass).
If the mix shown indicates a high share of fossil sources, you could benefit significantly from switching to a green offer.
How renewable energy contracts work: the role of Guarantees of Origin
When you sign a green offer, it’s important to understand that electricity does not flow directly from a solar panel or wind turbine to your facility. In the national grid, electricity produced from different sources—renewable or fossil—mixes into a single, indistinguishable flow. What you draw from the grid is always the grid mix.
So what exactly does a green contract guarantee? It ensures that a matching amount of renewable electricity—equivalent to your consumption (or the share covered by the contract)—is generated and injected into the grid.
That’s where Guarantees of Origin (GOs) come in. These are certificates traded across Europe (with similar systems elsewhere, such as Renewable Energy Certificates—RECs—in the US). Each GO certifies that 1 MWh of renewable electricity has been produced and fed into the grid. Without this certification system, it would be impossible to credibly trace and verify renewable generation linked to your consumption.
Why this matters for corporate decarbonization
Scope 2 emissions from purchased electricity can represent a significant share of your company’s greenhouse gas emissions. Switching to a supply contract backed by certified renewable energy is one of the most immediate and effective levers to reduce them.
The GHG Protocol—one of the leading international standards for calculating carbon footprints—sets out clear rules for reporting renewable energy. In particular, the “market-based” method recognizes your procurement choices, allowing you to assign an emissions factor of 0 gCO₂/kWh to consumption covered by Guarantees of Origin.
Where to start: measure first, then decarbonize
Switching to certified renewable electricity is a meaningful step—but it’s only one piece of a broader long-term strategy.
To achieve lasting results, it’s essential to start with measurement: calculating your company’s carbon footprint helps you understand where your emissions come from—from energy consumption (Scope 2) to direct emissions from your facilities (Scope 1) and those generated along the value chain (Scope 3), which are often harder to monitor but more impactful.
Only with this complete picture can you identify the most effective levers to reduce your climate impact: from renewable energy procurement to energy efficiency, from optimizing production processes to engaging suppliers.
At Kyklos Carbon, we help you quantify your emissions and build a targeted decarbonization roadmap. Contact us to calculate your company’s carbon footprint and understand where and how to take action.
Renewable energy contracts: how they really work and why they’re a strategic lever for decarbonization