Corporations Add Record Amount of Green Energy in 2017

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Global corporations signed a record number of power purchase agreements (PPAs) for green energy in 2017. A total of 43 corporations in 10 countries last year agreed to purchase 5,400 megawatts (MW) of clean energy, according to a new report from Bloomberg New Energy Finance (BNEF).

The previous record was 4,400 MW worth of PPAs in 2015. In 2016 corporations signed PPAs for 4,300 MW. Since 2008, corporations have signed contracts to purchase 19,000 MW of clean energy, an amount comparable to the generation capacity of Portugal. More than three-quarters of the contracts have been signed since 2015.

More than half of the 2017 total (2,800 MW) was contracted in the United States. The largest was a PPA between Apple and NV Energy for 200 MW. The electricity will come from the Techren Solar project and is the largest ever U.S. PPA signed between a corporation and a utility.

Kyle Harrison, a BNEF corporate energy strategy analyst, said:

The growth in corporate procurement, despite political and economic barriers, demonstrates the importance of environmental, social and governance issues for companies. Sustainability and acting sustainably in many instances are even more important, for the largest clean energy buyers around the world, than any savings made on the cost of electricity.

In the United States, a “tumultuous political climate and cheap wholesale power” were among the barriers to overcome. Another is the tariff that the Trump administration is expected to put on imported solar PV modules. A decision is expected by Friday, January 26. A tariff is likely to increase the cost of solar generation.

In Europe, the largest project was Norsk Hydro’s agreement to purchase most of the 650 MW generating capacity from the Markbygden Ett wind farm in Sweden. The deal commences in 2021 and runs through 2039. In all, European corporations signed PPAs for about 1,100 MW of capacity.

India is responsible for most of the 3,200 MW of corporate PPA deals signed since 2008 in the Asia-Pacific region. In 2017, Asian PPAs totaled 1,300 MW. Corporate procurement of green energy is not familiar to Asian markets, but this will change as multinational corporations in Asia push their Asian suppliers toward more sustainability. BNEF’s head of Asia-Pacific, Justin Wu, noted, “It won’t be long before Asian companies try to take advantage of the large amounts of renewable energy already deployed in their home markets.”