A growing number of Fortune 100 and Fortune 500 companies are committing to corporate sustainability goals—leading to an upsurge of renewable energy in business. In a wide-ranging examination of the subject published by Greentech Media, large corporations in the U.S. are reportedly poised to be the most powerful advocates for clean energy on both a state and national level.
Over 100 companies worldwide have already committed to using 100% renewable energy, according to RE100. But for some U.S. corporations, hitting that target can be a challenge. Many states do not yet have favorable legislation in place designed to help companies reach their sustainability goals. In advocating for new policies to meet their own goals, big business is also helping smaller companies access clean energy.
While there are still challenges in getting CEOs on board with clean energy investments in the first place, the conversation has evolved to how leading companies can make renewable energy procurement easier for those further down the Fortune 500 list—or off of the list entirely—by actively steering policy discussions.
There are a number of different routes that can be taken to reach corporate renewable energy goals. Each path can have advantages and disadvantages. Power Purchase Agreements (PPAs), for example, are one of the most popular solutions many organizations pursue to hit sustainability goals. PPAs give companies access to clean energy through agreements with third-party power providers—but only in states that legislatively support such initiatives. (To see where each state ranks in corporate renewable energy support, read this article.)
Enter green tariffs, which are offered by some utilities to businesses that are unable to access clean energy sources. These programs can vary greatly, but generally offer customers of all sizes access to renewable energy with competitive, long-term fixed pricing (often combined with renewable energy credits). One major drawback to this approach: Green tariffs can be complex for utilities to create and difficult to get approved by governing agencies.
This is where large corporations are using their size and consumer clout to help drive the creation of such policies—and traditional utilities are listening. A report cited in the piece from a leading trade association for investor-owned utilities says traditional electricity providers recognize the growing demand for green power and the opportunity it presents.
Also from the article:
As large corporate buyers invest in fulfilling their corporate renewable energy goals, state policy and utility planning must also evolve to take advantage of this trend, rather than be challenged by it.
Once created, green tariffs offer an attractive option for a wide range of customers to tap renewable energy as long as they fall within the proper jurisdiction. (In contrast, PPAs generally need to be renegotiated for each new project.)
Working together to break down market barriers, leading corporations and utilities are finding ways to make renewable energy more accessible to all customers. While major corporate players say they are encouraged by the progress that’s been made, there is still much work to be done in meeting specific industry needs and growing the space for procuring renewable energy more generally.