New Report ranks States based on a Company’s ability to procure renewable energy
Clean Edge, the Retail Industry Leaders Association (RILA), and The Information Technology Industry Council (ITI), with the support of The Energy Foundation, have just released The Corporate Clean Energy Procurement Index, a report ranking all 50 states
based upon the ease with which companies can procure [renewable energy] RE for their operations located within each state. The index consists of 15 indicators, broken into three categories: Utility Purchasing Options, Third-Party Purchasing Options, and Onsite/Direct Deployment Options.
One of the most interesting, and notable statistics in the report is the overall growth of renewable energy procurement by US corporations. We have noted here before that there is little doubt that corporations (and your consumers), along with State RPS standards, have largely driven the growth in renewable energy markets over the years. As the Clean Edge report states (emphasis added):
In 2015, commercial and industrial (C&I) buyers accounted for greater than half of all signed wind energy power purchase agreements (PPAs), outpacing utilities. The C&I market is now around five gigawatts (GW) of contracted wind and solar power, with commercial customers intending to procure an additional 60 GW by 2025, according to the Renewable Energy Buyers Alliance (REBA).
Corporate buyers are a major force in energy markets in general, but in renewable energy markets in particular.
Key points from the Corporate Clean Energy Procurement Index
- There are a number of mechanisms that corporations can use to purchase renewable energy in the United States: Utility Purchasing, Third-Party Purchasing or Onsite-Direct Deployment.
- Different states have created varying incentives for each one of these purchasing mechanisms– some states have paved the way for all 3 approaches, others have focused on one or two, other states have put up roadblocks to the purchase of renewable energy no matter the mechanism. The report ranks states by their commitment to policy and market mechanisms that enable clean energy procurement.
- As a corporation dedicated to procuring renewable energy, it is important to understand the options and opportunities available to you, and which approaches make the most sense in the states in which you operate.
- The report underscores a point that MWh also supports for commercial, industrial and institutional buyers of energy and power: expanded energy choice brings about strong support for renewable energy purchasing.
- The report recommends a 5 point state action plan to support corporations that are interested in increasing their renewable energy purchases:
Remove barriers to corporate deployment of both onsite and offsite renewable installations.
Support the development of next generation options to purchase renewable energy through utilities in regulated markets.
Expand energy choice options for C&I customers in regulated markets.
Ensure that an adequate market exists for renewable purchasing through both utilities and third-party programs.
Ensure that RE in both regulated and deregulated markets can scale up rapidly.
The report also does an excellent job of covering some key case studies and provides high level advice to energy buyers on how to approach various purchasing strategies.
A few additional thoughts:
- Make sure you know what you’re buying-– no matter whether it is a renewable or standard energy product.
- Know the market price, insist on understanding how the dollars flow from developers to your door.
- In addition, if you are buying a renewable energy product, make sure the product that you seek to purchase matches your corporate objectives. If you want to be able to support the development of renewable energy, but don’t care as much about claiming the environmental attributes then your project will differ from a corporation or organization that wants to demonstrate that it is lowering it’s carbon footprint or is net zero, for example.
Bottom line for energy buyers and finance professionals. The market for and availability of renewable energy is as robust as it has ever been. Many states have made great strides in supporting corporations’ efforts to buy RE.
There are a range of approaches to purchasing renewable energy. Make sure you’re informed about how best to buy renewable energy and how to align your ultimate purchase with your corporate objectives.