Corporate Clean Energy Buying Tops 30GW Mark in Record Year

Feb 7, 2022 04:34 PM ET
  • Companies purchased a record 31.1 gigawatts of clean energy with power acquisition agreements, or PPAs, in 2021, up virtually 24% from the previous year's record of 25.1 GW according to research firm BloombergNEF (BNEF). Over 2 thirds of this buying (65%) happened in the U.S. Nevertheless, additionally underpinning the solid growth is a surge in activity from the biggest technology business, who collectively signed over fifty percent of the offers.

Clean energy agreements were openly introduced by more than 137 companies in 32 various nations in 2021, according to BNEF's 1H 2022 Corporate Energy Market Outlook. Total authorized volumes were equivalent to greater than 10% of all the renewable energy capacity added globally last year, revealing the effect corporate sustainability pledges are carrying clean energy build.

Kyle Harrison, Head of Sustainability Research at BNEF, commented: "It is no longer a matter of whether corporate clean energy procurement will certainly grow annually, it refers just how much. Extra firms are making brand-new sustainability dedications, prices for renewables are dropping as well as regulators around the globe are gradually occurring to the reality that clean energy might be a silver bullet in the decarbonization of the private sector."

The Americas made up two thirds of the activity, with 20.3 gigawatts of PPAs announced, led by the united state, at 17GW. The online PPA, which functions in a comparable method to a monetary hedge, remains to dominate the U.S. market, with 12GW of deals, yet green tariffs with controlled utilities also experienced a record year, at 3.2 GW. Europe saw a record 8.7 GW of offers revealed, with big years from Spain and also the Nordics. Throughout Asia, just 2GW of PPAs were introduced, yet there were a variety of various other advancements. For instance, regulation for a corporate PPA version in South Korea was introduced in October 2021, while both China and Japan both saw record clean energy certificate issuances.

Modern technology business once more were the biggest corporate clean energy purchasers in 2021. For the second year straight, Amazon was the greatest customer around the world, introducing 44 offsite PPAs in 9 countries, amounting to 6.2 GW. This brings its total clean energy PPA capacity to 13.9 GW, making its clean energy portfolio the 12th biggest worldwide among all sorts of firms, just ahead of EDF. Microsoft and Meta have the next largest among companies, at 8.9 GW and 8GW, respectively. Formerly, Google held the corporate clean energy crown, however has actually transformed its interest more to sourcing 24/7 carbon-free power through approaches beyond PPAs.

Helen Dewhurst, Senior Associate at BNEF, commented: "The clean energy portfolios of big tech business now match those of the globe's most significant utilities. Big tech faces placing pressure from investors to decarbonize and also this is shown in the high increase in clean energy volumes acquired. The PPAs inked in previous years fade in comparison to the portfolios revealed in 2021."

Beyond of the formula, AES sold more clean energy to corporations than any other developer around the world, at simply under 3GW, based on publicly offered data. Two thirds of this occurred in the united state, but the AES portfolio of offers additionally included Brazil, Panama and also Chile. Engie authorized more than 2.1 GW of PPAs, consisting of a 350MW PPA with Amazon for the Dundee Offshore Wind Farm in the U.K. One of the tricks of success for both business is that they have the backing of a large utility to sustain their growth arms. This resulted in Orsted (1.3 GW), Vattenfall (0.8 GW) as well as NextEra (0.7 GW), all utilities, likewise having big years in 2021. These companies market clean energy to firms with mechanisms besides PPAs too.

Corporate sustainability dedications are still a driving force behind the record-breaking clean energy acquisitions. Some 67 business established an RE100 target in 2021, vowing to offset 100% of their electrical power need with clean energy, bringing the project to 355 members throughout 25 nations. These firms jointly consume 363TWh of electricity annually based on their most current filings-- surpassing the U.K.'s whole power generation for the very same year.

BNEF estimates that these 355 RE100 companies will require to acquire an added 246TWh of clean electrical energy in 2030 to satisfy their targets. This is less than its previous forecast-- greatly because of the activity from incumbent RE100 members, who acquired a record 21TWh of clean electrical energy via PPAs in the 2nd fifty percent of 2021 alone. Needs to this deficiency be met with offsite PPAs, it would certainly catalyze an extra 94GW of brand-new solar and wind construct around the world. This gets on top of the 47GW of PPAs currently signed by RE100 members.

BNEF updates its data on corporate purchase monthly and releases a market outlook on corporate energy technique bi-annually.

Solar Installers, Manufacturers