Full Title: Part 4: Private Procurement, Public Benefit: Integrating Corporate Renewable Energy Purchases with Utility Resource Planning
Author(s): D. Manning, J. Cook, J. Culkin, C. Edmonds, K. H. Hoffer, J. Lyng, and T. Plant
Publisher(s): Advanced Energy Economy
Publication Date: December 1, 2016
Full Text: Download Resource
With a growing list of major companies committed to meeting their electricity needs with renewable sources, corporate demand for clean energy goes above and beyond what is offered in any state. For these large corporations, investing in a long-term resource that gives them stable rather than fluctuating energy costs can be an attractive financial risk mitigation strategy as well a as corporate responsibility commitment. These companies are some of the largest consumers of electricity in the country, and their energy choices have a direct impact on utility resource needs. This paper examines opportunities to make it easier for states, utilities, and renewable energy developers to accommodate corporate renewable energy procurement.
In 2015, renewable energy made up 13% of electricity generated in the United States, with leading states Iowa, South Dakota, and Kansas getting at least one-fifth of their electricity from wind and solar. Contrast that with the 100% renewable energy goals that 33 U.S.- based, mostly Fortune 500 companies have committed to (see Table 1) and it becomes clear that corporate ambitions cannot be met through currently available resources. In total, 83 international companies have committed to 100% renewable energy as part of the RE100 initiative.
Corporations are moving ahead on their own. In the past four years, renewable energy contracts for nearly six gigawatts (GW) of capacity have been announced. Microsoft recently committed to purchasing 237 megawatts (MW) of wind power in Kansas and Wyoming, as one example. By 2020, it is estimated that the top 50 corporate buyers of solar and wind power in the United States will add more than 17 GW of renewable energy.
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. This paper charts three pathways to capitalize on the leadership of these corporate citizens by considering corporate renewable energy goals in state energy resource planning. By planning for the future with corporate renewable energy targets in mind, utilities and regulators can meet the needs of their entire customer base while opening options for companies to pursue these goals in a way that best fits their individual needs.