Companies are quickly becoming some of the world’s largest purchasers of renewable energy, beat only by utilities in terms of bulk purchases. A new study from BloombergNEF found that companies purchased 13.4 gigawatts of renewable energy through long-term power purchase agreements in 2018, more than double the 6.1 GWs of contracts they signed in 2017.
The majority of the contracts, which now total 32 GWs throughout the world, have been signed in the past few years. “Corporations have signed contracts to purchase over 32GW of clean power since 2008, an amount comparable to the generation capacity of the Netherlands, with 86 percent of this activity coming since 2015 and more than 40 percent in 2018 alone,” said Jonas Rooze, head of corporate sustainability for BNEF.
The majority of the new contracts 60 percent, 8.5 GWs were signed in the US. That’s nearly triple the amount signed in the country in 2017. In its 1H 2019 Corporate Energy Market Outlook BNEF said that 121 companies in 21 countries signed PPAs for clean energy in 2018. 21 different countries in 2018. This was up from 6.1GW in 2017, and positions companies alongside utilities as the biggest buyers of clean energy globally.
Facebook led the US and world with more than 2.6 GWs of renewable energy purchases last year, three times more than the second largest corporate energy buyer, AT&T. Even oil and gas companies are getting in on the action. Last year ExxonMobil became the first major oil company to power its operations with renewable energy when it signed a PPA for 575 MWs of solar and wind in Texas.
BNEF also saw some new trends like the growth of smaller companies entering PPAs by aggregating their electric demands. It said that 34 smaller companies made up 31 percent of the PPAs in the US. The companies are able to leverage the economies of scale by coming together to make bigger purchases, often partnering with a larger company or anchor tenant.
“The aggregation model has heralded in a new generation of corporate clean energy buyers. These companies no longer need to tackle the complexities of clean energy procurement alone. They can share risks associated with credit and energy market volatility with their peers,” said Kyle Harrison, lead author and corporate sustainability analyst for BNEF.
The report anticipated that companies will continue to go on the corporate energy buying spree. Thanks to their desire for clean energy and commitments like RE100 to get all their energy from renewables more renewable energy will be built. BNEF estimated that to satisfy their RE100 needs 102GWs of new solar and wind already need to be built by 2030.Tweet