Large Corporations Continue to Establish Aggressive Renewable Energy Targets and Drive Demand
The demand for renewable energy has increased, especially among Fortune 100 companies such as Google, Facebook, and Amazon. This increased demand, and the energy goals of firms like these, have led utilities to tailor their offerings via specialized rates and renewable tariff programs. Large corporations are also examining utility alternatives, e.g., third-party providers.
The fundamental energy goals for many large corporate customers include a commitment to:
- Electricity derived from renewable energy
- Energy efficiency within the organization
- Greenhouse gas emissions reduction
- In 2016, the number of utilities offering renewable tariff programs to key commercial customers grew to 10, twice as many programs as in previous years
- Some utilities that have recently established renewable energy tariffs include Puget Sound, Public Service Company of New Mexico, Rocky Mountain Power, and Dominion
- Reports show that renewable energy costs fell by more than 50% over the past decade and are projected to experience another similar dramatic decline, halving again by 2025 (https://www.scottmadden.com/fossil-minute/)
- Large corporate customers account for 21% of U.S. contracted renewable energy added to the grid in 2015 (equivalent to 3.2 GW), according to “Creating Renewable Energy Opportunities”
- Advanced Energy Economy reported in their 2016 Corporate Advanced Energy Commitments that 71 of Fortune 100 companies have set some measure of renewable energy or sustainability targets
Corporate Renewable Energy Target Examples and Partnership with Servicing Utilities
- In 2017, Google will reach 100% renewable energy for its global operations—including data centers and offices. NextEra Energy owns the 50,000-acre wind farm that supplies Google’s large data center in Pryor, OK
- Facebook has a renewable energy goal to power its data centers with 50% renewable energy by 2018. Omaha Public Power District (OPPD) is considering constructing 450 MW of new wind generating assets to supply renewable energy to Facebook. In January, OPPD approved a new rate structure for Facebook and other large customers
- Dominion Virginia Power (DVP) acquired the 80-megawatt Amazon Solar Farm U.S. East in Accomack County to support Amazon Web Services’ goals to power the company’s data centers with renewable energy
- Additionally, DVP filed special retail rates that allow Amazon to better match financial exposure in the wholesale market to local utility charges and PPA payments. This also will help streamline Amazon’s investment in renewables with the utility as a partner in local renewable energy development. DVP also filed for an experimental market-based rate that could be adopted by data centers and other similar large commercial electricity consumers
The trend by Fortune 100 companies to source renewable energy is expected to continue and increase in the coming years. Many vertically integrated utilities have responded by working with their largest customers who are requiring renewable energy. Third-party providers are also helping customers meet these needs through a variety of mechanisms.
World Wildlife Fund/World Resources Institute/Edison Electric Institute: Utility – Buyer Dialogue Insights
New York Times: Google Says It Will Run Entirely on Renewable Energy in 2017
Green Tech Media: Amazon and Dominion Power Forge a New Renewable Energy Path in Virginia
Advanced Energy Economy: REPORTS: Corporate Advanced Energy Commitments, Path for States to Capture this Growth
This report is part of the VIU Minute series. To view all featured Minutes, please click here.
Additional Contributing Author: Luke WilliamsView More