One way of reducing carbon dioxide emissions is to buy “green” electricity which is generated from renewable technologies (usually wind farms, hydro-electric, photo-voltaic or biomass). Most electricity companies have a “green” tariff, but comparison is confusing.
The Renewables Obligation was introduced in 2002, and sets targets for renewable energy (4.9% in 2005, rising to 10% by 2010) that electricity companies have to reach, or else pay a fine. However if a company exceeds the target then they are able to trade their certificates (called 'ROCs') to another company who has not reached the required level. Setting targets in this way encourages the development of new renewable electricity generation, but it means that by paying for a green tariff, you could end up simply paying extra to help the electricity company meet its legal obligations - without increasing demand for renewable electricity.
The Renewable Energy Strategy, published in 2009, proposed extending the Renewables Obligation to 2037, but shifting its emphasis to focus on large-scale renewable electricity projects. Smaller-scale projects up to 5 megawatts capacity, which include domestic and smaller commercial installations, will instead receive financial incentives through feed-in tariffs (FITs). These will be introduced from April 2010.
According to Consumer Focus, 'green energy' can mean one of three things:
- 'Green' source tariffs - where every unit of electricity used by a customer is matched by a unit purchased by the supplier from a renewable generator, such as a wind farm or hydroelectric company
- 'Green fund' tariffs - customers pay a premium that is used to finance the construction of new renewable sources of electricity generation, or other environmental projects. But most or all of the energy is derived from fossil fuels, so such tariffs can be for gas as well as electricity, as natural gas is itself a non-renewable resource.
- Carbon offset tariffs - these offset carbon emissions from fossil fuel use by tree planting or other carbon-saving schemes.
So, not all 'green' tariffs supply 100% renewable energy. In fact many are 'green fund' type tariffs, the nature of which will have an impact on your carbon footprint if switching. Most price comparison websites will provide information about exactly how 'green' the tariff is. 
One of the greenest is Good Energy (quote ref. GE450), the UK's only dedicated 100% supplier of renewable electricity, sourced from wind, solar, hydroelectric or sustainable biomass. Good Energy supports a community of over 1000 independent renewable heat and power generators by paying them for the energy they produce. The company also owns Delabole wind farm in Cornwall, built in 1991 and now receiving a further £11.8 million investment to boost its output by two-and a half times.