Seeking to increase the availability of cost-competitive renewable energy to run their businesses, 12 companies have signed the Renewable Energy Buyers’ Principles to better communicate their purchasing needs and expectations to the marketplace.
The companies – Bloomberg, Facebook, General Motors, Hewlett-Packard, Intel, Johnson & Johnson, Mars, Novelis, Procter and Gamble, REI, Sprint, and Walmart – hope the principles will open up new opportunities for collaboration with utilities and energy suppliers to increase their ability to buy renewable energy.
With a combined renewable energy target of 8.4 million MWh per year through 2020, the 12 participating companies are seeking a market shift to achieve their sustainable energy goals. Large-scale buyers often have to work around traditional utilities to purchase renewables at competitive prices at the scale they need, increasing complexity and transaction costs.
The Buyers’ Principles outline six criteria that would significantly help companies meet their ambitious purchasing goals:
- Greater choice in procurement options;
- More access to cost-competitive options;
- Longer- and variable-term contracts;
- Access to new projects that reduce emissions beyond business as usual;
- Streamlined third-party financing; and
- Increased purchasing options with utilities.
The principles address several major obstacles large companies face in procuring and installing renewable energy. For example, large buyers find current renewable energy markets are complicated to navigate and don’t deliver the products corporate customers are looking for. The sheer volume of renewable energy needed to meet their goals demonstrates both a clear demand and a market opportunity for any provider that can deliver what they need.
“We know cost-competitive renewable energy exists, but the problem is that it is way too difficult for most companies to buy,” says Amy Hargroves, director of corporate responsibility and sustainability for Sprint. “Very few companies have the knowledge and resources to purchase renewable energy, given today’s very limited and complex options. Our hope is that by identifying the commonalities among large buyers, the principles will catalyze market changes that will help make renewables more affordable and accessible for all companies.”
The Buyers’ Group is an informal consortium of companies interested in overcoming the obstacles to buying renewable energy and sharing best practices – not a power purchase group.
The principles evolved from a collaboration between World Wildlife Fund (WWF) and the Rocky Mountain Institute (RMI) to identify barriers to corporate achievement of renewable energy targets. The groups convened a Corporate Renewable Energy Buyers’ Day in 2013 to prioritize possible solutions – resulting in RMI’s creating the Renewables Resource Center and WWF’s partnering with the World Resources Institute to develop the new Buyers’ Principles.