Energy Procurement, GHG Emissions, Sourcing Renewables - July 13, 2018 - By Peter Bronksi, Henry Richardson
Corporations can generate one-third more impact with their renewables investment. Here’s how.
Recent weeks and months have seen a near-constant stream of headlines about the ongoing growth of corporate renewable energy procurement, including here in Smart Energy Decisions. It all boils down to a single, encouraging takeaway: corporate leadership and investment is a major influence driving renewable energy capacity additions.
To wit, a report released late last month by the International Renewable Energy Agency (IRENA) noted that last year companies in 75 countries actively sourced a collective total of 465 terawatt-hours of electricity, nearly equal to the overall annual electricity consumption of France.
In North America in particular, Rocky Mountain Institute’s Business Renewables Center (BRC) tracked 3.11 GW of power purchase agreements (PPAs) and similar deals for large-scale, off-site renewable energy (i.e., utility-scale wind and solar). This aligns closely with a late-January market report from Bloomberg New Energy Finance, which noted 5.4 GW of corporate renewable energy PPAs globally, including 3.1 GW in America.
In the United States, the BRC’s tracking totaled ~30 projects contracted by nearly 20 companies. The wind and solar projects spanned more than a dozen states. And hidden within those numbers is an opportunity to boost the emissions impact of that clean energy investment by one-third or more. Here’s how.
The most accurate measure of a new renewable energy project’s emissions impact on the electricity grid is the project’s emissionality, which quantifies the fossil-fueled emissions that are displaced by new renewable energy. By this measure, all renewable energy projects aren’t created equal. Depending on the grid mix in the region where they’re built, some will displace predominantly dirty coal-fired generation, some natural gas, and some will get added to grids already rich in wind and/or solar.
For corporations thinking about how to squeeze even more positive impact out of their renewables investments, this is a huge opportunity.
Here at WattTime, we analyzed 2017’s corporate renewables procurement in the U.S. and asked ourselves a simple question: If we geographically re-distributed last year’s actual corporate wind and solar projects to optimize their locations for avoided emissions, how much more impact could we generate from the same total megawatts of renewable energy?
The answer boils down to this: a lot. We found that corporations could squeeze 34% more avoided emissions out of their large-scale renewable energy investments. In terms of 2017’s corporate procurement, that equates to more than 2.5 million additional metric tons of avoided emissions, equivalent to pulling more than 540,000 cars off the road.
For corporations looking to outright maximize the positive emissions impacts of their investments, and likewise for corporations looking to wrangle the most efficiency out of their investments (in terms of emissions impact per dollar invested in renewable energy projects), these emissionality insights unlock a new frontier.
The corporate renewables market is evolving on many fronts, from small- and medium-size companies joining the market to new contract structures such as deal aggregation. But we firmly believe that emissionality should also be a core part of the go-forward path for the market. The emissions benefits are simply too great for it not to be.
Peter Bronski consults on cleantech marketing and communications for organizations such as Energy Web Foundation, WattTime, and Coronal Energy. He is the founder and CEO of Inflection Point Agency and the former editorial director at Rocky Mountain Institute.
As an analyst at Wattime, Henry Richardson helps WattTime’s partners and collaborators understand how they can affect the electric grid and achieve the greatest reductions in greenhouse gas emissions, whether through location-based differences or automated emissions reductions.